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5 Myths Regarding VA Loans

The iServe Blog


5 Myths Regarding VA Loans

Feb 7
7:50
AM
Category | The iServe Blog

A VA home loan is a mortgage guaranteed by the Department of Veterans Affairs; it’s part of the 1944 GI Bill. Recent years have been challenging for potential homebuyers, with tough lending rules and increasing difficulty securing credit. VA loans are surging in popularity, thanks to low rates and relatively simple processes. Some veterans and families are overlooking this useful program though, simply because of some common misconceptions about the lending process and requirements. Learning more about VA loans and VA loan rates can help you determine if this low-cost and beneficial product is right for you.

5 Common VA Loan Misconceptions

You Need Perfect Credit to Get a VA Loan

VA loans are designed to make it easier for military members and veterans to secure a home. Flexible guidelines when it comes to credit are part of the package, and are one of the reasons VA loans are simpler to secure for many military members. The VA does not require a specific credit score, but in general, a lender will look for “Fair” credit on a VA mortgage loan application.

VA Loans Are Expensive

Some VA loans require absolutely nothing down, and the VA places strict limitations on what lenders can charge veterans and service members for loans. A VA loan is already guaranteed by the US government, so it is less expensive for the homeowner, since costly PMI or mortgage insurance is not often required. Your loan will have an upfront funding fee, which can be rolled into the loan itself; this fee will vary depending on your personal history and is not charged to veterans with service-related disabilities.

It Takes a Long Time to Close

There is a common misconception about VA loans and the amount of time they take to close. Red tape may have slowed the process in the past, but if your last experience was five years ago or longer, you’ll be pleasantly surprised. The process has become more efficient and streamlined in the last few years.

VA Loans Are Risky for Lenders

Loans not requiring down payments may be seen as risky, but according to the Mortgage Bankers Association, zero-down VA loans actually have the lowest foreclosure rate of any type of mortgage in the last eight years. The VA uses education, common sense-based lending guidelines and an in-house foreclosure prevention team to mitigate risk and avoid foreclosures.

Surviving Spouses Can’t Get a VA Loan

If your spouse passed while serving in the military, you are still able to secure a VA loan; speak with one of our VA loan specialists to learn more about the process.

Anyone Can Help You With a VA Loan

While the program is designed to make it easy for buyers, you do need to choose a lender who is familiar with VA loans and understands the requirements and guidelines. Working with a team who appreciates your service and who understands the VA mortgage lending process ensures everything flows smoothly and that you are able to acquire your desired home with the minimum possible hassle.

Ready to look for your next home? Our team loves veterans and has plenty of experience with the VA lending process. We’d love to help you secure your next home with this useful and beneficial service members-only product! Contact us today to learn how easy it is to get started.