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WHAT IS A VA LOAN?
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The Veterans Administration (VA) does not make loans. VA guarantees that the lender will be protected against loss in the event of a foreclosure up to a maximum of 25% of the loan amount. A fee, called a funding fee, is paid by the veteran to the Veterans Administration for each loan. VA will guarantee a loan for any eligible veteran to purchase a home provided his income will permit him to make the mortgage payments, his credit history is acceptable and he has enough cash to close the loan. | |
ADVANTAGES OF VA LOANS
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- No down payment required if the purchase price of the property does not exceed the VA appraisal value.
- The seller may pay any or all of the veteran's costs.
- Fully assumable (with qualifying).
- No prepayment penalty
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| ELIGIBILITY REQUIREMENTS |
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To be eligible for a VA loan, and a Certificate of Eligibility, the veteran must have served in the Armed Forces of the United States of America for a specified amount of time. The length of service required varies based upon the period of time he or she has served. The veteran should have also been discharged under conditions other than dishonorable. |
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July 24, 1947 to June 27, 1950 - 181 days
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June 27, 1950 to Jan. 31, 1955 - 90 days
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Jan. 31, 1955 to Aug. 5, 1964 - 181 days
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Aug. 5, 1964 to May 7, 1975 - 90 days
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May 7, 1975 to Sept. 7, 1980 - 181 days
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Sept. 7, 1980 to Present - 2 years
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Currently in service - 181 days |
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Also eligible are unmarried widows of qualifying veterans whose deaths were service related. There are some exceptions to this schedule. Contact one of Southside Bank's Mortgage Loan Specialists for additional information. | | |
| FHA MORTGAGE INSURANCE |
Mortgage insurance is required on all FHA loans. The insurance is collected by the lender and paid to FHA. FHA uses this money to reimburse lenders on defaulted loans. MMI and MIP are the two existing types of FHA insurance. MMI (Mutual Mortgage Insurance) is collected monthly on approved condominiums. Insurance is paid on the remaining balance of the loan only, therefore the payments will decrease gradually over the life of the loan.
MIP (Mortgage Insurance Premium) is a one-time premium calculated as a percentage of the loan amount that applies to Single Family Residences (SFR) and Planned Unit Developments (PUD). This fee can be financed and added to the loan. | |
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VA LOAN PROGRAMS AND AMOUNTS
The maximum VA loan amount is currently set at $203,000 under certain conditions.
THE THREE PROGRAMS AVAILABLE ARE:
- 30 and 15 year fixed payment program.
- Graduated Payment Mortgage which allows the borrower to qualify at a lower rate but equires a down-payment and has deferred interest (negative amortization.)
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| VA APPRAISALS |
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All appraisals are done by VA assigned/approved appraisers. Most lenders have been approved nder VA's LAPP system and issue a Notice of Value to the borrower instead of VA setting value. | |
| ELIGIBILITY RESTORATION CRITERIA |
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The assumption of a VA loan leaves the veteran with limited eligibility until the loan is paid off in full as a result of a bonafide sale. Eligibility may then be completely restored and another property purchased using full entitlement. | |
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CO-MORTGAGORS
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If a veteran is legally married, VA will consider the spouse's income in qualifying for the loan. All other co-mortgagors must meet the following requirements: [a] Both must be veterans. [b] Both will occupy the property.
[c] Both will use their entitlements. [d] Both must qualify for of the payment. | |
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| BUYER'S COSTS |
- NO DOWN PAYMENT REQUIRED
- Loan origination Fee (1% of the loan amount)
- VA Funding Fee (varies and can be 100% financed)
- Credit Report
- Appraisal Fee
- ALTA. Lenders Title Policy
- Property Tax Proration and Reserves
- Hazard Insurance and Reserves
- Interest on new loan, based on date of closing
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Recording Fees | |
| SELLER'S COSTS |
- Seller's and Buyer's Escrow Fees
- Revenue Tax Stamps
- Standard Owner's Title Insurance Policy
- Sub-Escrow Fee
- Tax Service Fee
- Pay off existing Trust Deed and Liens
- Protation of Property Taxes
- Payment of assessments, etc.
- Structual Pest Control Inspection and Repairs
- Other repairs or the cost of repairs
- Broker Fees
- Association Transfer Fees
- Buyers' loan processing Fee
- Buyers' loan document preparation Fee
In a VA sale the Seller can pay all of the buyer's costs, however, the buyer can't pay any of the Seller's costs. VA does not set interest rates, so VA rates reflect market conditions like any other type of loan. Discount points need not be charged to anyone, but the discount points to obtain a lower market interest rate can be paid either by the seller or the buyer. | |
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Let one of Southside Bank's Mortgage Loan Specailists tell you more about the advantages of the VA loan. Give us a call at: 1-877-639-3511 |
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Ready to get started?
Click on the Apply Now button below and
provide the requested information. |
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