There are some common misconceptions about the VA home loan benefit. If you are new to the program or haven’t used your VA benefits in some time, you might need a refresher in what the VA loan program is and how it can benefit you.
Who Uses VA Home Loans?
VA mortgages are available to qualified veterans and currently serving military members. Contrary to what some have heard, VA loans are NOT automatically guaranteed to military members--you must qualify financially like any other type of home loan.
Who Can Apply For A VA Home Loan?
VA loans are, as stated above, for military members. But that does not meant that a non-military spouse can’t apply with the military member. In such cases the married couple are treated equally on the application. Non-military members can also apply with the military member, but only the veteran’s portion of the loan is guaranteed by the Department of Veterans Affairs. That may require the non-veteran to supply a down payment where required by the lender.
What Can VA Loans Be Used To Buy?
VA loans can be used for typical suburban homes, but also condominiums, town homes, duplexes, multi-unit properties, and even mixed-use buildings as long as the non-residential portion does not exceed 25% of the floor space. Ask your loan officer for more information on these types of properties and other options that may be open to you.
Myths About VA Loans
VA loans can’t, contrary to the opinions of some, be used to purchase RVs, houseboats, or farms. A farm home CAN be purchased with a VA loan, but buying a commercial farm operation is not permitted. The farm home rule is complex--ask your lender for more information. VA loans cannot be used to buy investment properties or undeveloped land. A borrower MAY purchase undeveloped land with a VA loan if there is a specific commitment to build with a construction date and the accompanying construction loan. This circumstance is also fairly complex--ask your lender for more information on how VA loans for new construction properties work.