Last Updated on February 7, 2023 by Bob Filipczak
If you are a first time VA home buyer, you’re in luck. In terms of government programs that will help military service members, the VA Loan is both one of the most popular and the most helpful. The list of benefits over conventional loans is considerable. Of course, the eligibility requirements can be lengthy too, but in general, you can qualify if you are an active-duty military professional, a veteran or a surviving spouse of a military service member.
When you are first time homebuyers in a competitive housing market, any help is welcome. The combination of volatile house prices and down payments and points and closing costs can combine to make you crazy. Add to that the complications of living in one place and trying to buy a first home in a new city–which is often the case with active-duty service members going from base to base–and your stress levels can build.
The first time home buyer VA loan program can help alleviate many of the sources of stress in your journey to find a new home. Likewise, we at Homes for Heroes, want to make it easy for you to find your dream home. Our program works with the VA home loan program to streamline the process of house hunting. While they cover things like down payments, interest rates and mortgage insurance, Homes for Heroes can help by pairing you with a real estate specialist, connect you with a mortgage specialist, who are both committed to serving our military heroes. On top of the VA loan benefits, working with our Homes for Heroes local specialists can save you an average of $3,000 after closing on a home.
“This was a surprise when we purchased our home. We moved to a different state, and had no idea there was such a program. It was a wonderful surprise to receive the payment just because we served our country. It is wonderful to be recognized for the sacrifice!” – Joseph, Navy, bought a home in Georgia.
“Overall great experience. I was able to use the Homes for Heroes program along with my VA Loan and purchased the home of my dreams. The Homes for Heroes real estate agent was phenomenal and I couldn’t be happier. Thank you!” – Stephen, Navy, bought a new house in Texas.
VA Loan Benefits
The most encouraging thing about the benefits of the loan program sponsored by The U.S. Department of Veterans Affairs is that the more you dig, the more you find. So hold on to your hat, because this is what the VA Loan Program can do for you.
- There is no down payment required–unless the cost of the house is higher than the appraised value.
- The program provides lower interest rates than the current market, which will lower your monthly mortgage payment.
- Private mortgage insurance is also not required.
- The VA will limit your maximum closing costs, which can be paid by the seller.
- There is no minimum credit score required from the VA, although private lenders, who will be granting the mortgage, typically want scores between 580-620.
- There is no penalty for paying your mortgage off early.
- You do not have to be a first-time home buyer to use a VA home loan.
- You can reuse the benefit throughout your lifetime, as long as the home you buy is your primary residence.
- Your VA home loan is assumable as long as the person assuming the loan also meets VA requirements.
- There is no maximum loan amount, however the VA does limit its guarantee. You can borrow up to $453,100 without a down payment in most of the country.
- The VA allows a flexible debt-to-income (DTI) ratio requirement, which is the comparison of your monthly income to the debts you have to pay each month.
- For a VA loan first time home buyer, the agency lowers its funding fee (2.15%). The VA funding fee is a one-time fee you pay to get the VA loan.
- If you have a bankruptcy or foreclosure in the past, you aren’t automatically disqualified from a VA loan. If your foreclosure or bankruptcy was more than a year ago, you could be eligible.
- Down the line, VA loans can be refinanced. They can even be used for a cash-out refinancing.
- VA loans can be used for single-family homes (up to four units), condos, manufactured homes, new builds and home improvements like solar panels.
- The Native American Direct Loan is a special loan for qualified veterans and their spouses if either is Native American.
That’s a pretty long list of benefits, for both active duty military members and eligible veterans.
Eligibility Requirements for First Time VA Home Buyers
With all the benefits associated with the VA financing, your next question may be: Am I eligible? It’s important to remember the VA home loan benefit is for service members in the following branches:
- Marine Corps
- Air Force
- Space Force
- National Guard
- Coast Guard
- Reserve members
It’s also available to surviving spouses of military service members. Generally, as a veteran first time home buyer, if you served at least 24 continuous months in the armed forces, you probably qualify. There is a long list of dates and length of service requirements, but it’s pretty easy to figure out. There are also some variations based on whether you were an officer or an enlisted member.
If you are an active-duty service member, you qualify for VA mortgages if you have served for 90 days continuous service.
The next step is to apply for a Certificate of Eligibility (COE). The form itself is only one page. When you are certified, you can apply for loans under the VA loan program.
Financial Eligibility for First Time VA Home Buyers
The VA loan program is actually a guarantee program. The actual money for the mortgage comes from private lenders and mortgage brokers. The VA insures the loan so the private lender has the confidence to give you the mortgage. The federal government is essentially standing behind you, which reduces the risk for the mortgage company. That means you will still need to provide some additional information to the loan officer who is going to give you the money. Work with your real estate agent and lender to figure out what you will need. Here are some of the most common documents requested:
- Certificate of Eligibility from the VA
- Bank statements
- Tax returns
Even though the Veterans Administration determines the eligibility for VA loans, your private mortgage lenders may have other conditions you will need to land your home loan. They may, for example, have different credit score requirements or tighter debt-to -income ratios.
Our Homes for Heroes lenders are skilled in VA loans, and they know the process well. There is no obligation for signing up, just savings for you, the first-time buyer.
VA Home Loans AND Homes for Heroes Hero Rewards
The VA loan program and the Homes for Heroes process complement each other admirably if you are looking for your first home. In terms of pure money savings, the VA loan guarantees are difficult to beat. Big ticket items such as down payments, interest rates and closing costs can make your dream house more affordable. The VA home loan process can make a real difference as you search for your first home.
For our part, Homes for Heroes can put together the right team to help you throughout the process – a real estate agent and mortgage loan officer committed to handling your VA loan and saving you money in the process. This team is committed to helping heroes like you find the right home and reward you when you close. At the end of your journey for your first home, we give you a Hero Rewards check (average savings is $3,000) to help you settle in, do renovations, get appliances or furnish your new place.
The VA loan program wants to help you afford your first home, and Homes for Heroes wants to provide the team to make that happen every step of the way and save you money in the process. Sign up today to get the process started. We would be honored to work with you.