For many qualified veterans, the federal VA-guaranteed home
loan can significantly reduce the financial burden of a first-time home
purchase. Benefits include allowing borrowers to secure competitive interest
rates without requiring a down payment or private mortgage insurance.
How it works:
When you use your federal VA home loan benefits, the federal VA does
not actually lend the money for the home. Rather, federal VA-guaranteed loans are made
by private lenders, such as banks, savings and loans, or mortgage companies.
The federal VA guaranty means the lender is protected against loss if the borrowing
veteran fails to repay the loan.
VA home loans can be used to:
- Buy a home, a
condominium unit in a VA-approved project
- Build a home
- Simultaneously
purchase and improve a home
- Improve a home
by installing energy-related features or making energy efficient improvements
- Buy a
manufactured home and/or lot.
Note: In all cases, the home must be
for your own personal occupancy.
Who qualifies?
You must have suitable credit, sufficient income, and a
valid Certificate of Eligibility (COE) to be eligible for a VA-guaranteed home
loan. COE’s are granted based on a number of factors related to the length and
nature of your military service. Spouses of veterans may also be eligible for
the home loan guaranty under certain conditions.
Find out more: Federal VA Home Loan Guaranty