25 Feb VA Home Loan Lenders Offer Affordable Options
VA Home Loans: Affordable options for would-be, new, and existing homeowners
VA-backed loans provide qualifying borrowers with a unique, and valuable, option regarding financing (or refinancing) home loans. The VA doesn’t provide the loans itself but instead provides a documented guaranty of the loan so that if the borrower defaults – the lender will recover a portion of the debt. This guaranty allows lenders more comfort and certainty, and in turn normally eases the requirements the lender may have for a borrower (less-or-no down payment, lower credit score targets, etc.).
VA-backed loans can be used to purchase a property, refinance an existing loan (either for cash-out or better loan terms), and in some cases modify or make improvements on a property. VA home loans offer lenders a greater degree of comfort – resulting in loan terms that are competitive and, generally, more favorable than one may obtain without federal backing.
So, how does a servicemember or veteran confirm if they qualify and obtain documentation of this fact? There are a few ways. A VA Form 26-1880 is the most traditional option. The form is completed and mailed to the address on the form’s top, right-hand corner. Alternatively – a veteran can have their private lender obtain documentation from the VA for them. While this is certainly more convenient (and many lenders will provide this service for you) – it limits the borrower’s ability to ‘shop around.’
Important points to remember:
- Generally, it is best to request figures/quotes from multiple lenders in the hopes of finding the best possible terms.
- Always keep in mind that many figures provided in quotes are estimates, and may end up slightly higher or lower in the finalized loan.
- Follow up with the VA and the lender whenever documentation is requested or required. Make certain everything you submit is received and updated promptly. Both the lender and the VA should stay on top of such matters, but it is always best to follow up and be certain.