VA Mortgages
As a top benefit of military service for eligible veterans, service members, and surviving spouses, you can access a low-cost mortgage and pursue your dream of homeownership.
What is a VA Loan?
A VA loan is a government loan backed by the Department of Veteran Affairs (VA) and issued by a lender or bank. Due to their lenient credit requirements, VA loans in Michigan are considered ‘non-conforming’ and offer several benefits to active-duty military members, veterans, and surviving spouses.
Benefits of Applying for a VA Loan
Due to a home loan program instated after World War II, military personnel has an opportunity to get back to civilian life by purchasing a home through the VA. Here are a few benefits included in the program:
- No downpayment
- No private mortgage insurance
- Lower interest rates for 30-year fixed mortgages
- Relaxed credit requirements
- Lifetime benefit for those who qualify
- No prepayment penalties
- Several types of purchase and refinance loans are available
Get Approved for a VA Loan
Relaxed qualifying standards
Option for no down payment
Option for no closing costs
Help available for getting Certificate of Eligibility
Qualifying for a VA Mortgage
VA mortgages are desirable for military members due to the no downpayment, lower interest rate, and lenient credit requirements. Here’s how you qualify:
- You’re an active-duty military member or veteran who served 181 days during peacetime, 90 consecutive days during wartime, or more than 6 years with the National Guard or Reserves
- You’re a spouse of a service member who lost their life in the line of duty, and you haven’t remarried
- You have a Certificate of Eligibility (COE) document to demonstrate your service
- You meet the income and credit score requirements (dependent on the lender, not the VA)
Is a VA Loan Right for You?
These answers to home buyer’s commonly asked questions may help guide you. To take the next step, our loan officers can help you choose the most affordable loan for your home.
Am I eligible for a VA Loan?
VA loan eligibility is service-based. Some contributing factors taken into consideration include:
- Your service status, e.g., active duty, separation
- Your years of service, and
- Your service record
The VA provides detailed eligibility guidelines outlining who qualifies for veteran’s benefits. You may meet eligibility requirements if you are:
- A current active duty military service member,
- A military veteran, or
- The spouse (including surviving spouse) of a service member
Eligibility is proven through a Certificate of Eligibility (CoE) from the U.S. Department of Veterans Affairs. It’s not required to apply for a loan but will be needed before approval. We can help you apply for a CoE or you can apply for it directly through the VA’s benefits portal online or by mail.
How much does the VA funding fee cost?
The amount of the one-time VA funding fee varies depending on your situation, such as your down payment amount and whether this is your first VA loan. For a VA purchase loan, the fee can range between 1.4% to 3.6% of your loan’s value. If you choose to later refinance your VA mortgage, the VA Interest Rate Reduction Refinance Loan has a fee of only 0.5%.
There are exceptions to paying the funding fee, including Purple Heart recipients, certain surviving spouses of veterans, and veterans with service-related disabilities. It can also be paid upfront or rolled into your loan to be paid over time.
Can I use VA benefits to purchase a home more than once?
You’ve earned these VA mortgage benefits and they are available to you as long as you meet the eligibility criteria. You may qualify for a VA loan for your first home purchase and may then qualify again for each home you buy in the future.
You can even use your CoE to qualify for two VA mortgage loans at one time. Your full eligibility is completely restored after a VA loan is paid off or sold.
There are also convenient and affordable options to refinance a current VA loan to help make your home expenses more affordable by getting a lower interest rate or adjusting mortgage terms.
What are the minimum property standards a home must meet for a VA loan?
The VA sets minimum property standards that each home must meet to ensure that the property is a good investment for the home buyer, the lender, and the VA. To determine if a home meets these standards, an inspection will be required.
These standards ensure that the home is safe, structurally sound, and sanitary
Factors considered could include the condition of a house’s roof, electrical, and heating, for example, but do not include cosmetic features.
Is there a maximum amount I can borrow with a VA loan?
The VA does not have a specified loan limit. At River City, you can borrow as much as you can otherwise qualify to purchase. If you would prefer the option for no down payment, the maximum loan amount for 100% in most areas is up to $548,250. You could potentially borrow more with no money down in a higher-cost area.
