For veterans and military homebuyers, VA loans represent the most powerful lender program in the market. Guaranteed by the VA and offered by the VA lenders, these loans have lenient requirements. But you need to fulfill the loan requirements in terms of the down payment or credit score of the lender to get approval.
Do you have a bad credit score? Not to worry! You can opt for one of the best VA loans for bad credit in Houston. But you should know these things before applying for this loan –
- You can use the benefit again and again
Your VA home loan benefit is not one-and-done. You can use it at diverse times. For example, you purchased a home with a VA loan. However, now, you have outgrown the home and need something bigger. When you sell the home and pay off the VA loan completely, you can re-use your benefit to purchase another home. Your entitlement is restored in full.
- They are only for certain types of loans
Are you planning to purchase a working farm, a downtown deli, or a fixer-upper? Then, the VA loan will not be the right choice for you. It is mainly designed for properties in “move-in ready” condition, along with single-family homes, modular housing, condos, some multi-unit properties, and more.
- They are for primary residence only
Don’t ever try to use your VA loan benefits to buy an investment property or a vacation home in the U.S. VA loans are for primary residences. But you can use this benefit to buy a duplex or another multiunit property, provided you live in one of the units. The VA does offer exceptions, though mortgage lenders also have their own standards, which might affect occupancy requirements.
- They are available despite foreclosure or bankruptcy
Veterans, who have a history of bankruptcy or foreclosure, can also secure a VA loan. Even homebuyers who have had a VA loan foreclosed on can still use their VA loan benefit.
- They don’t have mortgage insurance
Mortgage insurance is a monthly fee you can pay with other programs when you are not coming with at least 20 percent down. The VA’S guaranty eradicates the need for any mortgage insurance or mortgage insurance premium, and thus, helping borrowers save even more money each month.
- They come with a mandatory fee
There is no mortgage insurance with VA loans. However, there is a funding fee. It helps the VA keep one program going and is required on both purchase and refinance loans. It can be rolled into the loan amount, as well as waived entirely for those with service-connected disabilities.
So, you have ideas on various things about VA loans that were not known to you. What to do now? Improve your credit score to get approval for a VA loan or start looking for low credit VA lenders. Do the needful and achieve your dream.