VA loans are special loans made for those who served in the armed forces. There is different in paperwork and different procedures to obtaining a VA loan than there is for a traditional loan. Here we will use getting a VA loan in the state of Florida to explain how VA loans work.
What A VA Loan Actually Entails
One of the basic differences between a VA loan and a regular loan is that the loan is covered by the US government in the event that the veteran cannot meet the terms of the loan. The amount of the loan is generally between 36,000 and 60,000 dollars. VA loans in the state of Florida also do not have to have private mortgage insurance as well as no down payment. This is a sweet deal which makes it easy for a veteran who has served the country to buy a home to live the rest of their lives in.
If a veteran buys a home, there are great interest rates and they don’t pay the closing costs. There is however, a funding fee for the loan. How much that is will be determined by how much the veteran puts down, if they put anything down at all since it isn’t required of them in the first place. It is also contingent on if the veteran has used this program before or if this is their first time. VA loans in the state of Florida also take into consideration if they are in the National Guard or the Reserves. The amount of the funding fee can be up to 3% of the total price of the home and can be added into the loan if need be.
Steps to Obtaining A VA Loan in the State of Florida
First the veteran must apply for a VA loan the process is not automatic. They do this at the VA eligibility center. Along with the application, they have to furnish proof of service in the form of a document called the DD214. They go to a VA approved lender with proof of pay, bank statements and verification as well as verification of current employment to be approved for the loan.
Then a credit check and all the other traditional steps one would take to get a traditional loan. It is not necessarily easier to get a VA loan in the state of Florida. It is however, a better loan for the aforementioned reasons.
How Sellers Look at VA Loans
It used to be that sellers didn’t want to take VA loans. They used to take so much longer to close than a traditional loan. They have cleaned this issue up though. There was also a concern that due to the fact that veterans have only to pay a limited amount of fees that they would be stuck paying all the fees attached to the selling of the home. This can be easily made up by the seller in several ways. Some of those ways is adding the amount to the counter offer or asking the buyer to split the closing costs even though they are not required to do so. In a lot of these cases, the veteran is certainly flexible about the situation if they like the house and want it enough.
It is a blessed thing that veterans get a deal on buying their homes. They served their country well and they certainly deserve the perks on their basic needs. Getting a VA loan in the state of Florida is easier than you would think and well worth it.