You’ve served your country, and you deserve a nice place to live. You can get just that with a VA loan. These loans are available to:

• Active-duty military personnel
• Veterans
• Reservists
• National Guard members
• Some spouses of deceased veterans

How Does a VA Loan Work?

The Department of Veterans Affairs backs VA loans, but the money actually comes from mortgage lenders. Because the government backs the loans, lenders offer favorable terms. They are not assuming the same risk they do with other types of loans, so veterans and military personal get terms they couldn’t get with traditional mortgages. These terms allow people to finally get the homes they have always wanted.

Qualifying for a VA Loan

VA loans are easier to get than traditional loans are. Instead of disqualifying people based on their credit scores, the VA looks at the entire loan profile when making a decision. This profile includes the person’s income and debt, along with the credit score. Those who have the ability to pay the loan back are likely to be approved by the VA.

It’s important to note that many lenders have their own qualifications, though, and prefer borrowers with a credit score of at least 620. However, that isn’t a hard and fast rule, so you can qualify with a lower credit score. Some lenders will even fund the loan if you have gone through a recent bankruptcy. It depends on the reason for the bankruptcy.

Since the requirements are not set in stone, it is important to see if you qualify.

Take the VA Loan Qualifier

Once you take the qualifier, you will hear back from a member of the POP Mortgage team. Then, you will be ready to move forward with your VA loan.

Why Get a VA Loan?

Many people like VA loans over traditional loans because it is easier to qualify. Even if you have been turned down for a traditional loan, there is a good chance that you qualify for a VA loan.

That is just one of the benefits. You can also secure one of these loans without putting any money down, as long as you don’t borrow more than the home is worth. With many borrowers having to put as much as 20 percent down to get a home, this is a huge benefit.

You also don’t have to get Private Mortgage Insurance with this loan. The Department of Veterans Affairs backs the loans so lenders don’t need the security provided by PMI. On the other hand, people who get traditional loans typically have to get PMI if they don’t put down at least a 20 percent down payment.

The VA also puts a cap on the VA loan closing costs. Closing costs can be outrageous, so you will enjoy this benefit.

Then, to top it off, you will get low VA loan rates if you qualify. VA loan rates are often lower than traditional loan rates, so you will pay less for your mortgage.

VA Loan Limits

The VA has a limit on the amount of money it guarantees. While the guarantee amount is $417,000 for people around the United States, it is higher for people who live in California. The VA guarantees loans for up to $580,750 for California residents, as of 2016. This allows people in California to take part in the competitive real estate market.

You might wonder what happens if you want to buy a home that costs more than $580,750. You can still get a loan for the property, but the VA will only guarantee $580,750. That means that you might have to agree to different terms for the rest of the money. You will need to talk to your lender to determine how much you are eligible for and then go from there.

Funding Fee

If you get a VA loan, you will have to pay a one-time funding fee. If you’re a first-time borrower and don’t put any money down, your funding fee will be 2.15 percent of the amount of the loan. You can reduce the fee by paying a down payment. It’s important to note that if you’re a National Guard member or reservist, you will likely have to pay approximately a quarter of a percentage point more for your funding fee.

If you’re a second-time borrower and don’t put any money down, you will pay a funding fee of 3.3 percent of the loan amount.

People who receive disability compensation do not have to pay the funding fee. Be ready to provide paperwork that shows that you receive this compensation. Then, your lender will waive the funding fee.

Assistance for Borrowers

If you get a VA loan and have trouble paying your mortgage, the VA might step in and help. The VA is willing to negotiate with lenders on behalf of borrowers. Payment plans and loan modifications are often negotiated to help borrowers avoid foreclosure. For instance, the VA might help to change the terms so your interest rates and payment are lower. This will help you catch up on the payments. It is helpful to have an advocate in your corner, helping you make your payments.

Benefits and Considerations

Benefits
• Easy to qualify for
• No money down
• No insurance required
• Cap on VA loan closing costs
• No pre-payment penalty
• The VA might help if you have trouble making payments.

Considerations
• VA only guarantees up to $580,750 for California properties.
• You have to pay a one-time funding fee.

If you’re ready to get a VA loan, get the ball rolling by taking the simple VA loan qualifier. Then, you’ll receive your mortgage options and choose the one that is best for you. With our easy-to-use process, you will have your funds in no time at all. Then, you can finally get in the home of your dreams. Best of all, it will be a stress-free experience, thanks to POP Mortgage and the great terms you’ll get with a California VA loan.