VA loan

VA Purchase Money Loans

posted in: Mortgages

One of the overlooked benefits that are offered to veterans who have sacrificed their time, energy, and sometimes blood, is the availability of a VA-backed mortgage for the purchase of a home. In this day and age of rising costs due to inflation, uncertainty in Europe, and rising interest rates, a loan like this would allow a home buyer to utilize well-earned benefits. The service to our country is not a thankless sacrifice and I will explain how to apply TODAY at 7th Level Mortgage for the purchase of a home.

As with all loans, whether they be Conventional, Conforming or FHA loans, you need to go through a well trained professional loan officer, who has the backing of the processing, underwriting, and management staff so the process is made as easy as possible and with as few hiccups as possible.

Step 1: You must obtain your Certificate of Eligibility to show that you qualify for the home loan benefit. At the end of the article, I will provide the link to the VA website so you can see if you qualify as well as apply for the certificate itself.

Step 2: 7th Level Mortgage is THE lender to go through for your loan. Your entitlement is based on the following three statements, and one of them must be true:

  • You have never used your home loan benefit OR
  • You have paid off a previous VA loan in full and sold the property OR
  • You have used your home loan benefit, but had a compromise claim or a foreclosure and repaid the VA in full.

Step 3: As with all other mortgage loans, the lender will base your loan amount on your credit history, income and assets. Although the VA doesn’t have credit score requirements, be sure you ask your loan officer about any restrictions or conditions regarding credit scores for this loan program.

The loan limits that are established correspond to conforming conventional limits. They are established by the FHFA. The FHFA is the Federal Housing Finance Agency. On the same page as the other salient VA loan information is a link to the limits based on the county in which you are purchasing the home. I strongly recommend contacting 7th Level Mortgage directly regarding these limits. If there are any issues with the Certificate of Eligibility as far as how much of the entitlement is showing on their report, the issues MUST be cleared up. That is what 7th Level Mortgage is there for. The owner himself is a veteran.

The Certificate of Eligibility is a report of your service history and duty status. Additionally, your spouse may qualify for a VA-backed loan, even if the veteran is missing in action and/or being held as a prisoner of war. As part of the benefits of a VA-backed loan, statistically, 90% of the VA loans that are approved are with no down payment. This is yet another often overlooked benefit that conforming, conventional loans and FHA loans do not have in their menu of lending options.

As I have written before, rates across the board are expected to go up. Jerome Powell, chairman of the federal reserve testified at a recent Senate Banking Housing and Urban Affairs Committee hearing on March 3 that not only are rates expected to continue to increase but we are headed to a recession. In March the Federal Reserve increased rates by .25 basis points. For all loans, including VA-backed mortgages, the rates will increase. One of the tools available for you as a veteran to take advantage of is the lock and shop program that is currently being offered. Why gamble with a market that is tenuous at based and highly unpredictable? Rates could very increase by another .5 basis points as early as May’s meeting.

The chief danger to waiting is that should rates move even higher, the total payment may be more than the debt to income ratio of 41% will allow. All lenders offer loans based on the risk to their portfolios. What this means is that higher debt-to-income ratios mean more risk. Call  7th Level TODAY, lock in with their lock and shop program and once you have the contract with the realtor in place contact your loan officer so the process is a smooth one.

7th Level Mortgage is a leading one-stop mortgage company providing deeply informed, custom-tailored assistance with each mortgage transaction phase. If you are searching for a home loan in New Jersey, Pennsylvania, Delaware, Maryland, New York, or Florida, please contact us today so that we can determine the best Mortgage Lender to place your loan with and get you the best possible rate and program.