GovLoans.gov - VA - Home Loan

Program Description

VA guarantees a percentage of the loan. This helps the veteran obtain a no-down payment mortgage at a competitive interest rate.

General Program Requirements

Persons who may qualify for VA guaranteed loans include

Veterans (including Reserve and National Guard members who were called to active duty)
Active duty service members
Current Reserve and Guard members (usually after 6 years of reserve service)
Certain surviving spouses

Commissioned Officers of the Public Health Service and National Oceanic and Atmospheric Administration are considered to be active duty members and veterans, once discharged.

Length-of-service requirements apply in most cases.

Veterans must have been discharged under conditions other than dishonorable.

You will need a valid Certificate of Eligibility (COE). You can get one from VA or from a lender using the Automated Certificate of Eligibility (ACE) program.

If you need to obtain your COE, contact a lender about obtaining your COE or download VA Form 26-1880, complete it and mail it (with proof of service) to our Winston-Salem Eligibility Center at:

VA Loan Eligibility Center
PO Box 20729
Winston-Salem, NC 27120

You can download the form at http://www.va.gov/vaforms/search_action.asp.

For overnight delivery:
VA Loan Eligibility Center
251 N. Main Street
Winston-Salem, NC 27155

Toll free number: 1-888-244-6711
E-mail: nceligib@vba.va.gov

Loan Terms

A loan to finance the construction/purchase of a residence is closed prior to the start of construction with proceeds disbursed to cover the cost of, or balance owed on, the land, and the balance into escrow. The escrowed monies are paid out to the builder during construction.

A veteran begins making payments on a construction/permanent home loan only after construction is complete. So, if the home takes six months to complete construction, the payment schedule for the veteran obtaining a 30-year mortgage must provide for full repayment of the loan in 29 years and six months.

On a construction/permanent home loan, the builder is responsible for:

Interest payments during the construction period, and
All fees normally paid by a builder who obtains an interim construction loan including, but not limited to:
- inspection fees
- commitment fees
- title update fees, and
- hazard insurance.

Your Next Steps

The following information will lead you to the next steps to apply for this benefit.

Application Process

Contact a lender to discuss qualifying for the VA loan. The lender will make sure you meet basic program requirements, including the following:

The loan must be for the home you will live in.
The home must appraise for the loan amount or higher.
You must have enough income to meet your monthly mortgage payments, maintain the home, take care of other debts and obligations, and still have enough money left over to cover day-to-day expenses (food, gas, etc.)
You must also have a good credit history.

You may also wish to use the VA Home Loan website at http://homeloans.va.gov/veteran.htm as a reference point on how to use the program or for other more specific questions that you may have about the program.

Please note that if you are interested in obtaining an Adjustable Rate Mortgage (ARM) loan, that the loans are being offered as a traditional one year ARM and also as hybrids with three, five, seven and 10 year fixed rates, where available.

NOTE: If you plan to stay in your home for longer than the fixed rate period, an ARM may not be in your best interest.

It is a good idea to use a mortgage calculator to determine what the best loan, term and interest rate are for you and your family.

Program Contact Information

For more information on this program, please visit:
http://www.benefits.va.gov/homeloans/

Please contact a Regional Loan Center if you have detailed questions:
http://www.homeloans.va.gov/RLCWEB.htm

Managing Agency

Veterans Benefits Administration (VBA)

http://www.vba.va.gov