The Department of Veterans Affairs (VA) home loan program is among the most flexible and forgiving available loan types. With notable benefits such as zero down payment and lower interest rates, it’s no wonder the loan program is booming right now. Here’s a look at four common home buying hurdles for Veterans to avoid.
Home Buying Hurdles for Veterans to Avoid
A Less Than Optimal Credit Score
One of the most common home buying hurdles for Veterans to avoid is a low credit score. Just because VA loans allow for more flexible credit scores (as low as 580) it doesn’t mean that’s what the goal is. With a lower credit score, the interest rate that’s offered will be higher than that of a mid range credit score. Checking your credit scores and looking for opportunities to improve your credit ahead of time will benefit you once you’re ready to buy a home. With little time and dedication you can improve your score and take advantage of your hard earned VA benefits.
While many people think you can only buy a home in immaculate condition with a VA loan, this isn’t necessarily the case. A home doesn’t have to be brand new to qualify for a VA loan, but it does needs to meet the VA’s minimum property requirements to make sure the home is safe, sound and sanitary. For example, if the home is painted a less than ideal lime green inside, that’s ok. That will not affect the appraisal. However, if you’re noticing water stains and bubbles in the paint, that is not going to fly as it conflicts with the minimum property requirement held by the Department of Veterans Affairs.
One of the requirements of the VA loan guarantee is that you live in the home as your primary residence. This means you can’t use a VA loan to buy a rental property or vacation home. But this doesn’t mean you can never rent it out. Many VA buyers purchase in one location and then get transferred to another location. However, there’s no prohibition on renting out a property after you’ve occupied it. It’s also possible to have VA loans active at once, allowing you to rent the home at your old duty station and purchase a home at your new one.
While VA loans can be used toward manufactured homes, you have a bit of a longer road ahead with closing the VA loan than if you wish to purchase a single-family home with a VA loan. If this is the only possible way to buy a home, talk with your lender to discuss options.
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