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A Quick Guide to VA Loans
VA LOAN INTRODUCTION
This pamphlet is designed to help veterans planning to purchase or construct homes, particularly
those veterans who intend to finance with VA home loans.
The most important topics discussed in this pamphlet are:
- The cost of homeownership;
- Finding a suitable and affordable home;
- The agreement to purchase the home;
- Closing the loan (final settlement); and
- Before and after moving day.
Also be sure to look at the Checklist for Use in Buying or Building a Home.
This pamphlet does not try to discuss the arguments for or against homeownership. It is up to each
veteran to decide whether homeownership is best for his or her family.
This pamphlet does not apply to manufactured (mobile) homes. See VA Pamphlet 26-71-1 for
information about this type of home. See VA Pamphlet 26-4 for details about VA-guaranteed loans.
Since the end of World War II more than 14 million veterans have bought homes with the aid of VA
loans. The great majority of these veterans have bought soundly constructed homes and are now
making regular payments on their mortgages as satisfied homeowners.
However, a very small percentage of these veterans have had just cause to be dissatisfied with
the outcome of their venture into homeownership. It is hoped that this pamphlet, by stressing
the important things that a prospective homeowner should know, will help to reduce the number
of these cases in the future.
Buying a home is usually the most important financial transaction in the lifetime of the average
family. Before you decide to buy a home, therefore, you and your family should be certain that
you are:
- GETTING THE RIGHT HOUSE-THE ONE THAT SUITS THE NEEDS OF YOUR FAMILY.
- AWARE OF THE RESPONSIBILITIES THAT HOMEOWNERSHIP BRINGS.
What VA Does For The Home-Buying Veteran
VA guarantees part of your loan--which helps you to get a VA loan featuring:
- No downpayment (unless required by the lender or the purchase price exceeds the reasonable value as determined by VA); and
- Competitive interest rate and the flexibility of negotiating interest rates with the lender;
- Assurance that you can pay off all or part of the loan in advance without penalty.
- VA appraises the house to determine its reasonable value in the housing market at the time the appraisal is made.
VA requires compliance inspections in most cases on proposed new construction to see that the house:
- Meets accepted standards of good construction.
- Conforms to the plans and specifications on which VA's appraisal is based.
VA will try to assist you in getting your builder to correct any defects about which you
may have valid complaints.
What VA Does Not Do
VA does not have the legal authority to:
- Act as your architect. It does not supervise construction of the house you buy.
- Guarantee that the house is free of defects.
- Act as your attorney. It cannot provide you legal services if you run into trouble in buying or constructing your home.
VA cannot compel a builder to remedy defects in construction or otherwise compel the builder
to live up to a contract with you.
VA cannot guarantee that you will be completely satisfied with the house, or that you can
resell it at the price you paid.
VA cannot guarantee that you are making a good investment. That is a decision which only you
can make.
Do Not Be Misled
VA does not guarantee the CONDITION of the house which you are buying, whether it is new or
previously occupied. VA guarantees only the LOAN. You may talk to many people when you are
in the process of buying a house. Particularly with a previously occupied house, you may
pick up the impression along the way that you need not be overly concerned about any
needed repairs or hidden defects since VA will be sure to find them and require them to be
repaired. This is NOT TRUE! In every case, ultimately, it is your responsibility to be an
informed buyer and to assure yourself that what you are buying is satisfactory to you in
all respects. Remember, VA guarantees only the loan - NOT the condition of the house.
If you have any doubts about the condition of the house which you are buying, it is in your best
interest to seek expert advice before you legally commit yourself in a purchase agreement.
Particularly with a previously occupied house, most sellers and their real estate agents
are willing to permit you, at your expense, to arrange for an inspection by a qualified
residential inspection service. Also, most sellers and agents are willing to negotiate
with you concerning what repairs are to be included in the purchase agreement. Steps of
this kind can prevent many later problems, disagreements, and major disappointments.
FREQUENTLY ASKED QUESTION # 9 [ -more VA Loan questions- ]
- - - - - -
Q: The VA Guaranteed Loan - Advantages
A: If you are looking to purchase a home with no money down, you're in luck if you qualify. VA mortgage loans can be guaranteed with no money down in most cases up to $417 thousand dollars. An added bonus? No private mortgage insurance requirement with a VA guaranteed loan. The VA even offers help for those looking to refinance. Don't investigate these benefits without asking for information about the interest rate reduction loan, part of something called the Streamline Refinancing Program, which allows veterans to refinance at little or no expense to them. VALoans.com can give you all the details you'll need to take full advantage of your VA home loan benefits.
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VALoans.com is a private company specializing in VA financing and is
not a government agency.
Remember, the VA does not make home loans. They insure the loans that we can assist you in getting.
Let us help you get a VA insured mortgage loan at the lowest possible rates.
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