Everything you need to know about VA loans

There are millions of military veterans and active-duty service members in our country, but very few of them take advantage of Veterans Affairs (VA) benefits to buy or refinance their homes. In my experience, many veterans don’t know enough about the extensive benefits available to them, or think it’s a complex process. 

However, working with a knowledgeable lender can simplify the process significantly. Here are five important things to know about VA loans:

1. VA Loans Are Government-Backed but Available from Local Lenders

VA loans are offered by private banks, credit unions, and mortgage companies like Citizens Bank, not directly by the government. The Department of Veterans Affairs provides a guarantee to lenders, ensuring loan repayment if the borrower defaults. This guarantee allows lenders to offer more favorable terms, making the process as straightforward as obtaining a conventional mortgage.

2. VA Loans Offer Lower Rates and Less Risk

While conventional 30-year fixed mortgages are available to all qualified applicants, VA loans are exclusive to US veterans, active-duty military, and members of the reserves or National Guard. Because the VA backs these loans, lenders face less risk, which translates into lower interest rates for borrowers—typically about 0.25% lower than conventional loan rates. This makes homeownership more affordable for military families.

3. VA Loans Are More Lenient on Credit Issues

The VA does not set a minimum credit score, allowing lenders to approve loans for applicants with lower scores. Veterans who have faced financial difficulties, such as bankruptcy or foreclosure, can still qualify for a VA loan if they have re-established good credit over a couple of years.

4. VA Loan Benefits Never Expire

Eligibility for a VA loan is based on service time and period of service. Active-duty members generally qualify after 90 days of service, while National Guard members and reservists must wait six years unless called to active duty. Once eligibility is established, it lasts a lifetime. Even if you served decades ago, you can still use your VA loan benefits if you meet the requirements. Obtaining proof of service through a DD Form 214 and a Certificate of Eligibility (COE) is the first step.

5. Surviving Spouses May Be Eligible for VA Loans

Surviving spouses of fallen military personnel, POWs, or those missing in action may also be eligible for VA loans, provided they have not remarried. These spouses can benefit from no down payment and no mortgage insurance requirements. Additionally, the VA funding fee is waived for eligible surviving spouses, making homeownership more accessible.

Team Jerry Pounds Second Look

If you’re part of a military family and feel like you could have a better deal on your home mortgage, let my team take a second look. We specialize in helping veterans and their families get the best rate possible, so no matter who you have worked with before, we’ll help you from here on out.

Reach out to Jerry when you’re ready for a second opinion.

Is a VA Loan Right for You?

VA loans offer significant advantages to qualified borrowers, making them a valuable option to consider. Citizens Bank is here to help you understand your eligibility and navigate the VA loan process. Our resources and expert loan officers are ready to assist you in making the best decision for your homeownership journey.

*Citizens Bank is not affiliated with, endorsed by, or sponsored by the Department of Veterans Affairs or any government agency.*