Veterans: Did You Know You Had These Benefits?

If you’re a Veteran, you may already know that a VA loan can help you buy a home with zero down payment and no monthly mortgage insurance. But those are just two of the benefits. Your VA home loan benefit may offer more flexibility than you realize.

Here are some benefits worth knowing about:

• You may be able to use your VA benefit more than once. Your eligibility doesn’t necessarily disappear after you buy a home. Depending on your circumstances and remaining entitlement, you may be able to use the benefit again.
• There may be no VA loan limit with full entitlement. For Veterans with full entitlement, the VA does not impose a maximum loan amount for a zero down payment loan. You still need to qualify for the loan based on your income, credit, assets and the lender’s requirements.
• The VA does not set a minimum credit score. This doesn’t mean every borrower will qualify regardless of credit. Individual lenders may have their own credit requirements, but the VA itself does not establish a minimum score.
• Residual income matters. VA underwriting looks at more than simply your debt-to-income ratio. It also considers how much money you have left after paying your major monthly obligations. This is known as residual income.
• You may be able to buy a 2, 3 or 4-unit property. If you qualify, you can purchase a multi-unit property, live in one of the units as your primary residence and potentially rent out the others.
• A VA loan can be assumable. A qualified non-Veteran may be able to assume an existing VA loan, subject to the applicable requirements and approval.
• You may qualify for a funding-fee exemption. Certain Veterans and service members are exempt from the VA funding fee. For borrowers who are not exempt, making a voluntary down payment of 5% or 10% may reduce the funding fee.

There are other protections and opportunities worth knowing about, too.

Seller contributions may help with certain closing costs, depending on the transaction and applicable VA rules. The VA Escape Clause can also provide important protection when a property’s VA value comes in below the agreed purchase price.

And if you're an eligible service member facing deployment, deployment does not automatically prevent you from purchasing a home. Your individual circumstances and ability to meet the loan requirements still matter.

The biggest takeaway? Don’t assume you don't qualify simply because of something you heard about VA loans.

Before ruling yourself out, have a mortgage professional experienced with VA lending review your VA entitlement, funding-fee status, credit and complete financial picture. You may have more options than you think.

This content is for informational and educational purposes only and does not constitute legal, tax, or financial advice.