VA Loans is a mortgage where the Veteran’s Administration assists the United States Armed Forces veterans by partially guaranteeing a loan with zero or low down payment. This is available to those working military personnel and to retired military personnel. This loan is also made available to the spouses of soldiers who died in service as long as these spouses have not remarried.

     This kind of loan was made available in 1944 through the GI Bill of Rights. Approved lenders, banks and mortgage companies make this loan to qualified persons for a home purchase. Its guarantee serves as protection to a lender from financial loss in the event that the borrower fails to repay the loan. It replaces the protection in requiring for a down payment in most loans.

Below are some basic features of a VA loan:

1. No down payment is required for this loan, unless required by the lender if the purchase price is more than the value of the property.

2. The buyer is informed of a reasonable value in this kind of loan.

3. Aside from its low interest rates, the rates in this kind of loan is also negotiable.

4. This loan has the ability to finance the VA funding fee with a five percent down payment and exemption for veterans receiving VA compensation.

5. Closing costs are the same with the other kinds of financing and sometimes even much lower.

6. This loan has no mortgage insurance premiums and this is assumable.

7. A borrower has the right to repay the loan without corresponding penalties.

Here is a list of the duration and the kind of service required to qualify for a VA loan:

A. Wartime Service during:

World War II – September 16, 1940 to July 25, 1947

Korean War – August 5, 1964 to May 7, 1975

Vietnam War – August 5, 1964 to May 7, 1975

Persian Gulf War – August 2, 1990

B. Peacetime Service during periods:

July 26, 1947 to June 26, 1950

February 1, 1955 to August 4, 1964

May 8, 1975 to August 1, 1990

     In order to qualify, you must at least serve 181 days of continuous active duty. Your discharge must not be because of dishonorable reasons. If you served less than required, you could still qualify if the reason for your discharge is due to disability.

     Now, you need to decide if this program is for you. This loan is best for those who are unwilling or unable to make a down payment on a home mortgage. This provides loans with adaptable and permanent rates to assist you in finding the best loan for your monetary concerns. In several situations, veterans could avail of a second loan, and could get over an existing loan by buying a house and passing on the VA loan from one individual to another. A veteran who has paid in full his loan could qualify for a new loan.

     You must submit a copy of the DD214 form in your application. Bear in mind that the process will halt if you could not provide a copy of this form.  It is good to consult regarding credit ratings with a professional. They could help you in preparing your private finances before you fill up a homebuyer paper.

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