October 5, 2020

VA Home Loan Myths, Debunked

Townhouses, VA myths, VA condo loans, VA townhouse loans,

$0 down payment, no PMI, low VA mortgage rates, relaxed requirements, and no origination fee. Those are some serious benefits available to all qualifying U.S. service members and their families through VA Home Loans. But there is something we want to address…

One Unfortunate Truth

Too many veterans never reap the benefits to which they are entitled because VA Loans are commonly misconceived as a hassle or inflexible. Oh, no. We are going to do some debunking in the hopes that more doors open to our military veterans.

“The VA Home Loan Process Is Too Complicated”

When you search VA Loan How-To’s on the internet, do unfamiliar terms come up? Yes, but that is not to say they don’t describe simple concepts. Are there extra documents? Sure, but only a few. Here are the three VA-specific keypoints:

  1. Choose a Lender. Some lenders charge a higher origination fee on VA loans because of the added time and paperwork. At UHL, we believe that is not only silly, but that our past and active-duty personnel deserve better. Our origination fee is $0. We also offer highly competitive VA mortgage rates – which are already lower than conventional rates!
  2. Obtain a Certificate of Eligibility. Requesting the official document to prove benefit eligibility is nearly effortless. The VA website provides an online COE request option, as well as a tool that will help you estimate your guaranty.
  3. Pass the VA Home Appraisal. The Department of Veterans Affairs requires the property to meet minimum requirements before guaranteeing the loan. The appraisal process is no different than in a conventional purchase, except that a specified appraisal company must be used.

“I can’t buy a condo or townhouse”

It is true that borrowers are limited to a list of VA-approved condominium projects. The good news is, the list is rather large. You can use the VA’s condo search tool to find the prospective property, right down to the name of the complex. It is not true that townhomes need prior VA approval. Only condos are subjected. If the property you are considering falls in the gray area between condo and townhouse, check the county records to find out the official assignment.

“It will only cover some of my loan.”

This statement became myth only recently when the Blue Water Navy Vietnam Veteran Act of 2019 went into effect on January 1st, 2020. Included in the Act was a provision to eliminate VA Loan limits for borrowers with full entitlement. For those borrowers who have already used some of their entitlement, you are still eligible for benefits. See how much by using the guaranty tool mentioned above. And finally, surviving spouses of eligible veterans can also receive full entitlement by requesting a surviving spouse COE.

“It’s not that hard. And totally worth it.”

Ding, ding, ding! Not a myth! Imagine the opportunity that comes along with zero down and lowered interest rates. It seems worth the extra step of requesting a COE. We have VA loan experts here at UHL, ready to answer questions, and stand by a veteran’s side from the day they see the house until long after closing day.

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