No limits using VA loan eligibility

For many things in life, being a good consumer is a benefit. Learning everything one can about a product or service helps to ensure several things: good value, good service and a more positive outcome.

Navigating the world of home loans is no exception, particularly for first time home-buyers.

For Servicemembers, veterans, or surviving eligible spouses of a Servicemember or veteran, the U.S. Department of Veterans Affairs (VA) has a Home Guarantee Program.

“VA helps Servicemembers, Veterans, and eligible surviving spouses become homeowners,” reads information on the VA website. “As part of our mission to serve you, we provide a home loan guaranty benefit and other housing related programs to help you buy, build, repair, retain, or adapt a home for your own personal occupancy. VA Home Loans are provided by private lenders, such as banks and mortgage companies. VA guarantees a portion of the loan, enabling the lender to provide you with more favorable terms.

So, if you are eligible, where do you begin the research? And how do you decide if you want to take advantage of this program?

Loan experts agree – start with the VA itself.

Julie Swenson, a loan officer for the Legacy Group in Tacoma (www.legacyg.com), highly recommends visiting the VA website to learn the basics and obtain other information first.  “When you Google ‘VA Loans’ there are a lot of things that can come up,” Swenson said. “It’s best to go directly to the VA site (http://benefits.va.gov/homeloans/) to learn if you qualify and more details about the program first.”

Michelle Wickett, branch manager at Axia Home Loans in Olympia (www.axiahomeloans.com), agrees.

“Starting with the VA website is a sound plan,” Wickett said. “Also, search the internet carefully. There are a lot of lenders that may pop up in a search; if these lenders aren’t experienced, you may pay more than you should.”

The next step is to know your circumstances and your budget.

Take a look at your living circumstances today, and then look forward.

“Consider how long you expect to be stationed at JBLM to make sure that you will be there long enough for the home to appreciate in value,” Wickett said. “By knowing this information, this will help be sure that you are able to sell at a breakeven point or greater – in the current market that will very likely be five years.”

For some, Swenson noted, it makes better sense to rent instead of buy.

These are tools that can help people take the thought process even further.

“We have a software program we use to really take a look at the rent versus buy scenario,“ Swenson said. “This can be a helpful exercise to determine what makes the most sense.”

The experts also note that it can be easy to get caught up in the emotion of buying a home. The most important thing to remember is to be realistic and stay focused on your budgetary goals. When you are ready to see a lender, have your budget established so that you have already figured out a mortgage payment you are comfortable making. Lenders base qualifying on gross monthly income (before taxes), and you live on your net income (after taxes). Therefore, it’s the consumer that should be the one establishing the amount, and you need to be comfortable making the payment.

Here are some additional items to think about when considering a VA loan:

• Most VA loans are for 100% of the purchase price, plus the VA funding fee, so the loan starts off slightly upside down from day one.
• There is no limit to the number of times you may use your VA eligibility as long as you are in good standing and have remaining entitlement.
• If you have adequate residual entitlement, you may be eligible for more than one VA loan at a time. While doing research takes time and effort, it’s really worth it in the end.

“Do your homework,” Wickett said. “This in turn will really set you up to succeed.”

This article was written by Kim Thompson. Visit www.northwestmilitary.com for more articles.