Frequently Asked Questions About VA Mortgage Loans
The most common questions I field with respect to VA mortgages, center around what the program is, and who is eligible, initially and over time.
Q. Who is eligible for a VA mortgage loan?
A. The general rule for VA Eligibility. A veteran is eligible for VA home loan benefits if he or she served on active duty in the Army, Navy, Air Force, Marine Corps, or Coast Guard and was discharged under conditions other than dishonorable after either 90 days or more, any part of which occurred during wartime or 181 continuous days or more during peacetime.
The Veteran must have satisfactory credit and repayment ability as evidenced by stable income, residual income ( net effective income minus monthly shelter expense) in accordance with regional tables, and an approved ratio of total monthly debt payments to gross monthly income.
(Bookmark this site and look for more information about VA Eligibility in future articles)
Q. If I have already had a VA loan, am I eligible to get another VA loan?
A. If you have paid off your prior VA Loan and have sold that property that had the VA loan, you may have your eligibility restored for additional use. On a one-time only basis, you may have your eligibility restored if your prior VA loan has been paid in full but you still own the property.
Q: If my prior loan was foreclosed on, or I gave a deed in lieu of foreclosure, or the VA paid a compromise (partial) claim. Would I be eligible for another VA home loan?
A: If the government still suffered a loss on your loan. The law does not permit the used portion of the veteran’s eligibility to be restored until the loss has been repaid in full.
If a veteran has already used a portion of his or her eligibility and the used portion cannot yet be restored, any partial remaining eligibility would be available for use. You can then discuss with me whether the remaining balance would be sufficient for the loan amount sought and whether any down payment would be required.
Q. What is the funding fee for a VA loan?
A. Unless determined by the VA to be exempt from the funding fee, the VA charges a funding fee that can be added into the loan amount. The VA funding fee is a % of the base loan amount.
The % for all loans closed after November 22, 2011 on a loan to purchase a home for a first time user of their VA eligibility is 2.15%. Currently for subsequent uses of a VA loan, a veteran would be charged a 3.3% funding fee. The % amount charged for a funding fee decreases if a down payment is made by a Veteran. The funding fee charged for an interest rate reduction is .50%.
Please see the VA funding chart to find the % for different loan situations. (Ask me for a VA funding fee table if you have not yet received one)
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I’m Here to Help
Please don’t hesitate to call me at 303-721-1001 to discuss any and all questions you have about getting a VA mortgage loan. I really am happy to spend time on the phone or in person helping you get comfortable with the process and working with me.