17 Jan Navigating VA Home Loan Closing Costs: Understanding Exemptions for Disabled Veterans
VA home loans are a valuable military benefit allowing veterans to purchase a home without a down payment. However, like any other type of loan, closing costs are associated with a VA home loan. These costs include appraisal, title search, and loan origination fees.
Closing costs can be overwhelming and confusing, but it’s essential to understand what they are and how they can affect your loan. The good news is that the VA limits the number of closing costs veterans can pay, and there are exemptions for veterans with service-related disabilities.
Exemptions for veterans with service-related disabilities
One of the enormous benefits of a VA home loan is the exemption for veterans with service-related disabilities. If you have a service-related disability, you may be eligible for a waiver of all closing costs, including appraisal, title search, and loan origination fees.
To qualify for a VA Loan closing cost exemption, you must have a service-related disability that the VA has determined to be compnsable, and the disability must also be rated at 10% or higher. If you are not sure if you qualify, you can contact the VA to determine your eligibility.
How to apply for an exemption?
Suppose you are a veteran with a service-related disability and are interested in applying for an exemption. In that case, you will need to submit a VA Form 26-4555 (Veterans Application in Acquiring Specially Adapted Housing or Special Home Adaptation Grant) to the VA. This form can be found on the VA’s website, and you can either complete it online or download it and mail it to the VA Regional Loan Center in your area.
It’s essential to keep in mind that the VA must approve your application before you can receive an exemption. The application process might take up several weeks, so it’s a good idea to apply as soon as possible.
Other ways to save on closing costs
In addition to the exemption for veterans with service-related disabilities, there are other ways to save on closing costs. One way is to ask the seller to pay for some of the closing costs. This is known as a seller concession, and it can help reduce the amount of money you need to pay out of pocket.
Another way to save on closing costs is to shop around for the best deal. Compare rates and fees from different lenders to find the best one for you. Keep in mind that closing costs can vary from lender to lender, so comparing offers from multiple lenders is essential.
VA home loans offer many benefits to veterans, including the ability to purchase a home without making a down payment. However, there are closing costs associated with a VA home loan. The VA limits the amount of closing costs that veterans can pay, and there are also exemptions for veterans with service-related disabilities. If you are a veteran with a service-related disability, you may be eligible for a waiver of all closing costs. Understanding the closing costs associated with a VA home loan is essential and exploring all options to save on these costs is vital.