Saturday, 18 November 2017

The VA Loan Process Step-by-Step

Written by Posted On Thursday, 10 December 2015 19:24

To first-time home loan borrowers, the loan process can seem not only confusing but also somewhat daunting. Those who are not familiar with the procedures involved will not know what to expect.

However, in general, there are five key steps to the process involved in availing of a VA home loan. The steps are not necessarily always completed in the following order. Nevertheless, the process is the same every time and will result in an optimal home buying experience.

1. Frequently, it’s best practice to work together with a VA lender who will help to ensure you are prequalified. 

Prequalification offers a foundation for the remainder of the home loan process. After pre-qualification, you will be provided with an estimate of your potential purchasing power, thereby you will not invest time in assessing homes that perhaps are not obtainable.

2. Gaining preapproval for your home loan.

The process of preapproval is more thorough than that of prequalification. The lender makes an in-depth assessment of your financial affairs. This will include your tax returns, pay stubs, bank statements, real estate assets, investments, and employment history.

3. Following on from prequalification and preapproval, you can then select a realtor to help you find a suitable home.

4. Once you have selected a home, an offer is made.

You’ve chosen your new home, and now you should ensure that a VA option clause is included in both the purchase and sales agreements. Further, it is recommended that the investor assess for an “escape” clause within the contract. This serves to protect the buyer should they be unable to avail of the VA loan. There is a further reason: Both prequalification and preapproval ought to be obtained prior to the home search being conducted.

After you’ve made an offer and the loan paperwork is received by the Veterans Benefits Administration, the loan officer will obtain the Certificate of Eligibility by using a copy of your DD-214.

5. Processing and closing the loan.

The VA must appraise your home in order to assess for any major issues other than cosmetic. The lender will process your income and credit information, then await the home appraisal result.

Once the lender is in receipt of the appraisal information, everything is considered and the decision to either approve or deny the potential buyer is finalized.

Should the VA loan then be approved by the lender, a “closing” process is started.The lender, the title company, and also an attorney will work to coordinate the completion of the home loan.

If you have any concerns about your eligibility of a VA loan based on bad credit, you can seek further advice from Anchor your Assets bad credit VA loans info.

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