va home loan benefits

Maximizing VA Home Loan Benefits for Tampa Veterans

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May 15, 2024

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Homeownership has been a pillar of the American Dream since its inception in the 1930s. Yet, today, many Americans think they’ll never become homeowners due to rising home prices and interest rates. Forbes reported that in September 2023, the average cost to purchase a new home was $412,000!

Fortunately, all hope is not lost. There are many programs and grants to help those during the home-buying process. One such program is for those with military service through VA loans.

Backed by the Department of Veterans Affairs (va.gov), these loans provide advantages to help those from one of the eight uniformed branches (Army, Navy, Air Force, Marines, Coast Guard, Space Force, NOAA, and PHS) purchase a home. This includes members of the National Guard, the Reserves, active duty service members, and some categories of spouses.

So how do VA loans work, and what are the guaranty benefits? Continue reading to learn more about VA home loan benefits.

Understand Your VA Home Loan Benefits

Understanding the benefits of a VA home loan can help first-time homebuyers navigate the pathway to homeownership. These include:

  • No down payment; finance up to 100% of the home’s purchase price
  • No private mortgage insurance (PMI)
  • Competitive interest rates
  • Lenient credit score requirements
  • Limited closing cost fees
  • VA funding fee financing (a one-time payment that you can finance into the loan amount instead of paying upfront)

For service members who need specially adapted housing (SAH), disability compensation is available.

Significantly, VA benefits also vary by state. Read more about Florida’s veterans’ benefits to understand benefits unique to Florida residents.

In addition to purchase loans, the VA offers other loan programs, such as Interest Rate Reduction Refinance Loans (IRRRL) and Native American Direct Loans. Refinancing and home improvement loans, such as cash-out refinance loans, are also available. Many of the same benefits are available for the various VA loans.

If you need further assistance, you can explore housing grants, too.

Start Without a COE

Contrary to popular belief, borrowers don’t need a Certificate of Eligibility (COE) to start the loan process. Lenders typically get the COE for you during the pre-approval stage.

Notably, surviving spouses are eligible for a COE if one of the following is true:

  • The veteran is missing in action or is a prisoner of war (POW)
  • The veteran died while in service or from a service-connected disability, and the applicant didn’t remarry (conditions apply)
  • The veteran had been totally disabled and then died, but their disability may not have been the cause of death (conditions apply)

Know the Acceptable Uses

The VA home loan program aims to help veterans purchase or refinance primary residences. You can use them for the following property types:

  • Condos
  • Manufactured homes
  • Modular homes
  • New construction homes
  • Single-family residences
  • Some multi-unit properties

You cannot use a VA loan to purchase a vacation home, working farm, or any income-producing property, such as an investment property. However, you may convert a primary residence you buy with a VA loan into a rental property after living there for a specified amount of time.

Similarly, it’s imperative to understand the eligibility requirements for VA loans, including military service and financial requirements. For instance, if you had a foreclosure, you typically must wait two years before you can apply for a VA loan.

Work with a VA Home Loan Savvy Real Estate Agent

Many loan officers and mortgage lenders are unfamiliar with the rules of a VA loan because it’s a specialized program with unique rules. The VA details property requirements the home must meet.

Working with an agent with ample knowledge about VA loans is beneficial to ensure you select an eligible property. For example, the right real estate agent will ensure the purchase price falls within the allowable loan limits to qualify for a VA loan.

Understand VA Mortgage Rates

VA-backed loans typically have lower interest rates than conventional mortgages. This is because The VA guarantees the loans. These competitive VA home loan rates are one reason veterans should use VA loans.

VA loans use a fixed rate, which means the rate doesn’t change for the duration of the loan. As of April 9, 2024, the rate for a 30-year mortgage was 5.990% (compared to the standard loan rate of 6.375%). Even a modest lower interest rate will significantly lessen your monthly mortgage payments.

Know What Impacts Your VA Loan Interest Rate

Like conventional loans, mortgage companies will look at several factors to determine your interest rate. These include:

  • Credit score
  • Current market conditions
  • Loan duration
  • Loan type

Even though you can get a VA loan with a lower credit score and zero money down, you’ll get a better interest rate during the entitlement (approval) process if your finances are in order. While many people need the benefit of having less stringent eligibility requirements, those who can improve their finances should consider doing so before getting a VA loan.

Work with the Right Lenders

Although the U.S. Department of Veterans Affairs backs different loan types through the VA loan program, private lenders such as banks, credit unions, and mortgage companies guarantee the loans.

You want to find a lender that will not only offer you a great interest rate but also has experience with VA loans. Often, these are smaller lenders or credit unions, not big banks.

Find Your VA Home Loan with Associates Home Loan

Don’t let your financial situation stop you from building home equity. VA home loans are available to help active and retired service members purchase a home and experience homeownership. The many VA home loan benefits are convincing enough to see why this is the right step for you and your family.

Ready to get started?

Apply now for VA home loans in Tampa from Associates Home Loan in Florida. We streamline the process to make it simple and easy for you to apply and get approved. We also offer many other home loans, such as FHA loans, conventional mortgages, and more!

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