All About VA Loans and How You Can Apply for Them

Do you often hear about VA loans and are you interested in learning what they’re all about? To begin with, a VA loan is a mortgage whose guarantee is given by the United States Department of Veterans Affairs. VA loans are meant to offer long-term financing to veterans who have worked in the American armed services or their spouses whose partners lost their lives in a service-related cause. Those who are eligible for this loan can apply for it. They can go for this loan even when they fail to get private financing. One of the major USP’s of this loan is that a borrower doesn’t have to make a down payment.

Let suppose that you are a resident of Texas. Before you go looking here and there to secure a loan, you must know that VA loans in Texas are made available to eligible and qualified veterans through direct lenders, mortgage brokers and banks. As far as the interest charged on a VA loan, it can be similar to that which is charged in a conventional mortgage.

To secure a VA loan, you need to follow certain steps. First and foremost, you must become pre-qualified to purchase a home or get a loan refinanced. For this, you have to get a pre-approval letter before you make an offer on a home. If you are buying a home and not getting a loan refinanced, you can go for a house whose closing costs don’t exceed 4% of the total amount and can be incorporated in the contract.

For a formal loan application, you will be required to furnish a copy of your purchase contract and there will be other disclosures that will require your signature. In the end, as you show some personal documents, your loan should be approved. Post the approval of your loan, you can go ahead and start closing on your new house. What will happen in the end is that you will again be signing some final loan documents and the purchase transaction as well as the transfer of ownership will be finalized. Then your new home will be all yours.

Why Choose a VA Home Loan?

When it comes to home ownership, everyone wants to put in their best effort to find the best deal. Aspiring home buyers are always on the lookout for ways to make the most out of their investment. This includes obtaining a home mortgage loan at the best possible terms.

For example, VA home loans in Texas are a preferred option for veterans in the region. These mortgages are guaranteed by the US Department of Veterans’ Affairs. VA mortgages are in place to help veterans of the American armed services or their qualifying spouses benefit from long-term financing to buy their own home.

Let’s talk about why a VA loan is the best mortgage option for those who qualify:

One of the best features of a VA loan is that it offers 100% financing. While in the current lending environment, it’s very tough to get a loan without a down payment. These loans help qualifying buyers purchase their home without making a down payment. Some FHA loans come with the lower down payment option of 3.5%, but even this figure may be unattainable for some buyers.

When opting for a VA home loan in Texas, buyers are able to free themselves from having to pay for Private Mortgage Insurance (PMI). This is because VA loans are backed by the federal government. This means huge savings for home buyers, which could amount to 0.5% to 1% of the complete loan amount on an annual basis.

Relaxed credit requirements are another highlight of VA loans. Potential buyers with less than perfect credit scores may qualify for these loans. Most VA lenders ask for a credit score of 620, which is a blessing for military home buyers. Moreover, the interest rates fluctuate based on the market and individual borrowers, and they may even fall below conventional loan rates.

Last but not the least, VA loans come with no prepayment penalty. In some cases, paying off a conventional home loan within the first five years may cause you to incur a prepayment penalty equal to about 6 months of interest. VA loan borrowers don’t have to deal with any such penalty, which makes these loans even more of a lucrative option.

In case you think that you might qualify for a VA loan, get in touch with a reputed lender in your area; someone who has rich experience in this domain. The right guidance from a VA approved lender can take you closer to home ownership.

Determining Eligibility for Texas Veteran’s Home Loans

Texas veterans home loans offer the military veterans in Texas an opportunity to own a home. The best thing about these loans is the fact that veterans don’t need to make a down payment. Also, they can receive up to 103.15% of the sale price of the property as a loan. Out of this 3.15% includes the funding fee that can be financed with the total loan amount. In order to qualify for such loans, veterans need to fulfill certain conditions.

When you choose to apply for a mortgage, the best decision you can make is to consult a respected mortgage company with qualified loan officers who can evaluate your current financial condition, assist you in understanding various loan programs and apply for a loan. They can also assist you in finding a qualified real estate agent.

When working with a loan officer on a home mortgage, they will help you through the requirements process, including proof of service and income. Here are some of the documentation requirements for veterans home loans:

1. Certificate of Release or Discharge (DD214): This form is available for retired veterans, reservists and those serving in the National Guard. The form is proof of discharge from active duty. A loan officer can assist you in filling out this form and submitting it to the lender who can help you get approved for a VA mortgage so you can begin the process of owning a home.

2. Certificate of Eligibility (COE): You will need this when applying for a loan. You can get a COE from the VA or your mortgage company can assist you in obtaining one. This certificate ensures that you meet the minimum VA loan standards.

3. Statement of Service: Active duty service members need to submit this document. This document is evidence of their active service that specifies the start date of their duty and their end date. This contains the signature of a senior officer.

Especially for Texas, there are specific mortgage programs for veterans such as the Texas Veterans Land Program being offered by the Texas Veterans Land Board. A leading company in the state assists you in choosing the best Texas veterans home loans. These experts can help you determine the best and most affordable price range based on interest rates and other costs. This is especially for veterans who have financial constraints. The mortgage company will walk you through the entire process and ensure that you make an informed decision.

Qualified Mortgages and Its Impact on the VA Loan Borrowers

There’s a new type of loan called the ‘Qualified Mortgage’. Most of us have heard of it, especially prospective homebuyers who question the impact that it will have on their home mortgages. For example, retired or active duty military servicemen are speculating about the impact that these changes will have on their ability to get the benefits of a VA home loan.

The financial slowdown of 2008 led to the introduction of numerous stringent rules and regulations. This was done to put restrictions on giving away easy loans and to reduce the possibility of loan defaults. However, such restrictions have made life difficult for borrowers who are looking to buy a home. At the same time, the government has been implementing and modifying new mortgage policies to provide relief to these borrowers, and a Qualified Mortgage is one of them. There are some specific policies that have been implemented by certain U.S states. The perfect example would be the various programs and initiatives being taken by the government in Texas; especially its impact on the veteran home loan in Texas.

What is a Qualified Mortgage?
Qualified mortgages mainly focus on the safety and affordability of prospective homebuyers. During the 2000’s, many lenders provided mortgages to a large number of borrowers who had poor credit scores and who were not in the situation to pay back the loan. These subprime loans were the main reason that contributed to the financial meltdown and led to the collapse of the housing market.

The scenario mentioned above eventually led to the introduction of the qualified mortgage. The qualified mortgage does not have the risky features of other mortgages and it ensures that the borrowers can afford to repay the loans that have been sanctioned. Regulators have also laid down eight credit and underwriting requirements that must be met to obtain Qualified Mortgage status. Mortgage companies can still provide loans that do not meet the standards of a qualified mortgage, but those loans will not get protection as per this regulation.

The Effect on VA home loans
People who are worried about the impact that qualified mortgages will have on VA loans have a reason to smile. The good news is that it will not have much impact on the VA loans. These underwriting guidelines have been followed by most of the lenders over the years. Hence, no additional action needs to be taken to comply with these underwriting requirements.

In fact, VA loan borrowers will get some added advantages as it will limit the costs involved in obtaining a mortgage. It has been estimated that around 92% of the loans that have been taken out meet the requirements of a qualified mortgage. The other 8% of the loans either exceed or have a higher annual percentage rate (APR) than allowed. This shows that the new guidelines will not have much impact on a majority of home loans.

Qualifying For A VA Home Loan in Texas

Despite the Department of Veteran Affairs offering lucrative terms on home loans, not even 12% of military veterans have taken advantage of it. The primary reason for such low participation is that many veterans are unaware of the loan programs and if they qualify. Most have instead opted for loans offered by the Federal Housing Administration (FHA). However, with the sharp increase in mortgage insurance premiums on FHA loans in 2014, the demand for VA loans has risen.

To apply for a VA Loan you will have served in the Army, Navy, Air Force, Marines, National Guard or Coast Guard for a minimum of 90 days. Additionally, for VA Loans in Texas, you must meet the following criteria:

• You are an active military serviceman looking for a permanent change of station (PCS) to Texas
• You are an active military person and already living in Texas
• You had a home in Texas when you entered the military
• You had a home in Texas when you left the military
• Your home has been in Texas for at least a single day
• You intend to use the home as the primary residence

If you satisfy the above criteria, you may be eligible to apply for a VA home loan. If you are retired, be ready with your DD214 Form to apply for the loan. If you are an active military person, a statement of service will be needed to start the application process.


If you are a veteran, you deserve all of the benefits a VA Loan has to offer. Contact one of our VA Loan experts today to learn more.

Source: http://davidsongroup.net/mortgagepedia/posts/qualifying-va-home-loan-texas/

More to VA Loans Than Competitive Loan Rates

The advantage of taking out a Veteran Affairs (VA) loan is quite far reaching. The main purpose of this loan is to make life easier for active duty or retired military personnel. That is why lucrative benefits are offered to them through this program, which includes providing a guaranty on loans of up to 100% value of the property that they choose to buy. Even the funding fee from 0% to 3.15% that may be required for this loan can be financed by the Department of Veteran’s Affairs. This mortgage also provides another key benefit of zero down payment. Also, in terms of interest rates, among all the states VA loan rates in Texas are lower due to the support provided by the state.

There are some conditions to fulfil in order to get financing for a home loan under the VA mortgage program. The price of the house should not be more than the reasonable value as assessed by the department. So, the down payment will be waived only if the sale price of the house does not exceed the appraised value. However, unlike the FHA loan offered to other citizens, the veterans are not required to pay monthly insurance premiums.

Some other benefits of taking out VA loans include limiting closing costs, having a provision to allow sellers to pay closing costs, no prepayment penalty for early loan payoff and the guaranty provided by the VA department if borrowers find it difficult to make payments.

We at the Davidson Group can assist you with your VA loan needs. Our experienced loan officers can walk you through your options, and manage the complicated paperwork and official proceedings on your behalf. Over the years, we have helped hundreds of active-duty and retired military professional. We believe our veterans deserve the highest respect.

Source:  http://davidsongroup.net/mortgagepedia/posts/more-va-loans-competitive-loan-rates/

First Time Homebuyers are Better off in Texas

According to research by the National Association of Realtors (NAR), first time homebuyers have not been contributing much to the recovery of the housing market in the U.S. However, certain areas of the West and Midwest are likely to witness a rise in home purchases by the millennial generation. The research conducted by NAR considered the population and job trends in the metropolitan areas across the country to arrive at this conclusion.

The purpose of the research was to determine the most suitable markets for these young homebuyers. The finding of the research is good news if you belong to the millennial generation and are looking to buy your first home in Texas. Among other property markets, Austin is found to be one of the best Texas cities where these potential buyers are likely to purchase their first home. This region is in a better economic state, offers high job growth rates and affordable home prices compared to other metropolitan centers.

This optimism is in sharp contrast to the plight of millennial homebuyers in the other top US cities such as San Francisco and New York. The young populations in these cities are reeling under student debt, limited job prospects, restricted wage growth and tight credit conditions. Anyone looking to buy their first home in Texas needs to know all of their options before taking out a home loan.

Despite Texas being better off than other housing markets in the country, homebuyers need to ensure that they fulfill all the conditions in order to get all of the mortgage benefits. In this way, buyers could become eligible for several convenient loan options and downpayment assistance programs.

Easy loan options for first time homebuyers in Texas
Even first time homebuyers who belong to the low income bracket can buy a home in Texas. They can apply for a Federal Housing Administration (FHA) loan and qualify for a loan with as low as 3.5% down payment. If coming up with this amount of down payment becomes difficult for homebuyers, they can apply for one of the down payment assistance programs that have specifically been designed for Texans.

To learn more about these loan options, contact a credible mortgage firm today. Use any popular web search engine to look for one that offers the assistance of expert loan officers on all kinds of specialty mortgages.