The VA loan program was created in 1944 by the U.S. government as a benefit to veterans for their service to our country. VA loans are not made by the Veteran’s Administration rather the VA provides a partial guarantee to the lenders that provide them. This allows for favorable program features and terms for the veteran. Not all lenders participate in the VA Home Loan Program, only those approved by the VA can offer them.

Attractive features of VA financing

• There is a menu of fixed, graduated payment and adjustable programs available for VA financing. The loan can be used to purchase condos, build a home, for home improvements, to refinance an existing home loan up to 90% of the VA established reasonable value or to purchase a manufactured home (single wides included).

• There is a fee charged for the Department of Veterans affairs to guarantee a VA loan. This is called the “funding fee”. It may be financed into the loan amount in most cases and waived for veterans classified by VA as 10% or more disabled.

• Veterans are eligible to receive 100% financing for the purchase of a primary residence.

• No private mortgage insurance (PMI) or reserves are required.

• Loan approval can be obtained for purchases two years after a bankruptcy or three years after a foreclosure.

• Default assistance to avoid foreclosure and counseling are available to veterans during difficult financial times to help vets keep their homes.

• The loan is assumable subject to VA approval of the assumer’s credit.

• No prepayment penalties.

Who is eligible?

• The applicant must be an eligible veteran who has available home loan entitlement. There is a minimum number of days of active duty required which can vary depending on whether or not the duty was during wartime or peacetime. Interested people can review the rules of eligibility by accessing this link to the VA’s General Rules for Eligibility: www.benefits.va.gov/homeloans/elig2.asp. Spouses of veterans may also be eligible for VA loans.

• Reasonable credit and sufficient income to cover housing expenses and other credit obligations must be documented.