As a military service member, or the spouse of one, it’s nice to know the U.S. government looks out for your family by helping to keep home buying costs affordable. Yet, you still need to do your research to determine if this type of loan is right for you.
There are a few steps involved with providing your eligibility during the application process. When you are ready to move forward with buying a home, you can use this guide to make informed decisions during the loan process that help you take advantage of every resource available for obtaining an affordable loan.
Find Out If You Are Eligible
When people refer to military home loans, they typically mean VA Home Loans. VA loans are only given to people who fit specific criteria for eligibility. However, you may be eligible even if you are not a veteran. The eligibility criteria for these types of loans is based upon the amount of time you served. For an active duty member, you only need to have 90 days of service on your record. Retired members of the military who service two or more years may also be eligible, and those in the Reserves for six or more years could qualify.
Consider the Benefits of a Loan for Military Members
Home loans for military members, or VA loans, are backed by the U.S. Veterans Administration. Since private lenders know that these loans are guaranteed by the government, they are able to offer benefits that make it easier to obtain one and put the finances together to buy your house.
Avoid Having to Put Down a Large Down Payment
For most types of loans, you can expect to need anywhere between 3.5 percent and 20 percent of the home’s purchase price for the down payment. Military loans, however, do not require you to have a down payment unless the house that you are buying exceeds certain limits. Contact our office for more details about the limits in your area.
Opt Out of Mortgage Insurance Payments
You also benefit from being able to skip making monthly mortgage insurance payments. In most cases, this can save you several hundred dollars a month that you may need for other important costs that are associated with being home owner.
Get a Loan Even Without a Perfect Credit Score
Depending upon your situation, you may also be worried about how your credit score will affect your ability to procure a loan. Home loans for service members tend to be more forgiving of past mistakes such as having a bankruptcy or slow payments on your record provided that you can give an explanation for the issue and how you have improved.
The lower credit requirements also make this an ideal way for younger people without an extensive credit history to obtain a loan.
Start Getting Your Documents Together to Apply
All home loans require you to submit specific documents to the lender that demonstrate proof of your identity and ability to repay the loan. For instance, you will need to have pay stubs, bank statements and other financial documents available when they are requested.
When you apply for home loans for military, you also need to have a Certificate of Eligibility (COE) available. This is formal document that is issued by the Veterans Administration that lets lenders know that you are officially eligible for a government-backed loan. The process of obtaining this form is also simple since the lender can request it on your behalf, or you can submit a request for one on your own.
Securing a loan for your new home allows you to put one of the hardest parts of the buying process behind you. With a military loan, you can enjoy even more savings such as lower closing costs that allow you to maximize the financial benefits of being a homeowner.
How To Apply
When you are ready to apply, use our online application to speed up the process & determine if you qualify. If you have questions, contact one of our loan experts today.