02 Feb What Are VA Loan Contract Guidelines For Purchasing A Home In 2021?
You must choose a VA approved lender.
VA loans are provided by private lenders and not by the Department of Veterans Affairs. The VA only backs a specific portion of the loan, securing the lender against default. However, you must choose your VA lender based on a few factors. For example, you should only reach out to lenders permitted by the U.S. Department of Veterans Affairs to provide VA mortgages. You must also check whether the lender focuses primarily on conventional loans or deals majorly in VA loans. Some lenders offer both conventional and VA loans.
Getting your Certificate of Eligibility (COE) is mandatory.
To apply for a VA loan, you need to submit a Certificate of Eligibility (COE) to the lender along with other documents. You can obtain your COE from the Department of Veterans Affairs or request your lender to arrange it for you. Your COE is an acknowledgment from the VA establishing your eligibility for VA loans.
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Look for Pre-Qualified Loan Options.
Pre-qualification strengthens your loan eligibility but isn’t required. You can save your time and efforts if you pre-qualify for a VA loan. To pre-qualify, you will have to share your income, credit history, employment, marital status, and other factors with the VA loan professional. Submitting your details to the lender in advance will help during underwriting.
Begin the House Hunt and Sign a Purchase Agreement
This is where you start hunting for your dream home. You may need the guidance of an experienced real estate agent specializing in VA loans to explore all available options. The VA permits the seller to pay some specific costs (if both you and the seller agree). So, an experienced real estate can help you negotiate seller-paid fees.
Your Lender Shall Order VA Appraisal After Processing Application.
You must have a signed purchase contract to complete your initial application. After that, your lender will order the VA appraisals. You will have to get your home options evaluated by a certified professional eligible to perform VA appraisals. The VA appraiser will ensure that you’re purchasing the home at its current value.
Sign the buyer’s agreement at closing and move into your new home.
Once the underwriting is done, all you need to do is close the agreement and move into your new home. At the closing, the seller will legally transfer the property title to you. We recommend you go through your loan terms and conditions before signing the agreement on the closing day. You can request the seller in advance to pay a portion of or the entire closing cost.
Like any other loans, VA loans are financial products that should be purchased with an expert’s guidance. We recommend you consult an experienced VA loan advisor at first.