What is a VA Loan?
VA stands for Veterans Affairs. The U.S. Department of Veterans Affairs created a military serviceperson loan guarantee program in 1944 to enable active and returning military service members & their surviving spouses to purchase homes in cases where private financing is not generally available and help our service members realize the dream of home-ownership with no down-payment.
The VA Loan Guarantee Program was expanded in 1992 to expand the eligible pool of borrowers to also include National Guard personnel and Reservists. The VA Loan Guarantee program guarantees mortgages made by approved VA lenders to military personnel and their spouses.
To clarify a point of confusion, the Agency of Veterans Affairs does not directly make VA Loans. The VA, rather guarantees the loan enabling approved VA lenders the ability to offer eligible borrowers loans at highly competitive mortgage rates, with no down-payment, no mortgage insurance, and easier credit/underwriting guidelines. The loan is meant for the purchase of a service member’s primary residence only – not second homes or investment properties.
The COE (Certificate of Eligibility) is an official form that you complete and submit to the VA. The COE verifies to your lender that you are eligible for a VA-backed loan.
You can download a COE form here.
Foundation Mortgage as an Approved VA Correspondent Lender can help expedite the processing of your COE and assist you in fully explaining your Eligibility Benefits. Our VA Home Loan Specialists can help you gather the proper documentation, complete the COE properly, and navigate any hiccups with the VA in the processing of your COE.
Assuming you have full use and maximum guarantee available & your credit/income/asset/debt profile qualify, what is the maximum loan amount you can borrow under the VA Home loan guarantee program?
Click here to Access Our VA Loan Limit Calculator
Click here to Access Our VA Loan Limit Calculator
The VA Funding Fee is a unique cost to VA Loans. It is a one-time fee paid as part of your closing costs on both VA Purchase Loans and VA Refinance loans.
The Funding Fee is a percentage of the loan amount. The Percentage varies depending on the type of VA Home Loan and your military category, if you are a first time or subsequent user of the program, and whether you make a down-payment.
The VA Funding Fee goes directly to the VA to ensure that the VA loan program can maintain funding and will continue to be available for future generations. The VA Funding Fee is used by the VA to offset the loss on loans that go into default, and thus reduce the cost to US Taxpayers to maintain the program.
Borrowers have the option to pay the Upfront Funding Fee at closing as part of their closing costs, or to roll it into the loan amount to keep the borrower’s cash-out-of-pocket lower.
VA Home Loan Borrowers with service-related disability can receive an exemption from the VA and may not have to pay the VA Funding Fee.
As mentioned above, the VA Funding Fee is a one-time fee paid directly to the VA.
How much will your VA Funding Fee cost?
Mortgage Insurance – PMI - Savings
Assumptions: 95% LTV, 750 Credit Score, SFH, 30% Coverage, 30 Year Fixed, Approve/Eligible, Primary Residence, Florida
VA Streamline Refinance (Non-Credit Qualifying) - VA IRRRL
The new P&I payment must be lower on the new VA loan; unless
An increase in the Veteran’s monthly payment may happen if:
No. You can’t use a VA Streamline IRRRL to take cash out. To receive cash-out, you would have to qualify under a traditional VA Cash-Out Refinance program which requires traditional credit and underwriting.
The one exception is reimbursement for the cost of energy efficiency improvements up to $6,000 that were completed within 90 days preceding the date of closing on the new IRRRL home loan.
Leverage your investment and use the equity your home has gained over the years
Good for
Renovating your home
Paying down high-interest debt
As an established homeowner, you can improve your financial security by refinancing to a lower payment
Good for
Lowering your monthly outlay
Planning for retirement
Learn how the home buying process works with our mortgage Refinance into a shorter term so you can pay off your mortgage soonere tools and resources page
Good for
Reducing the amount of interest you’ll pay
Becoming mortgage-free faster
Get Your Personalized Low-Rate Mortgage Quote Now