By Thomas Carroll, REALTOR®
So, it is time to buy a home and you’ve decided that the VA loan may be the way to go. VA loans often come with below average interest rates, require no money down and do not charge PMI. It really is a sweet deal! Now the question is, how do you go about obtaining a VA backed home loan? Here’s a step-by-step guide to help you through the process.
- Obtain a Certificate of Eligibility (COE). This certificate lets banks know you are eligible for this product so that you can get your mortgage application process started. You can apply for your COE here: How To Request A VA Home Loan COE | Veterans Affairs
- After you have your COE, you will want to identify a lender. In today’s competitive environment where most homes are receiving multiple offers, ask to be fully underwritten. This is not a VA loan requirement, just good practice. Traditionally, lenders provide buyers with a pre-approval letter which let’s sellers know this buyer is a good bet. However, with a preapproval letter, the buyer still has to include a financing contingency in their offer which allows them to back out of the deal if they do not make it through the lender’s underwriting process. If you as the buyer get fully underwritten by the lender before searching for a home, you do not need to include a financing contingency in your offer which drastically improves your chances of getting your offer accepted.
- Work with your real estate agent to find the right home for you and get it under contract to purchase.
- Have the property appraised by a VA approved appraiser. Your lender will set this up. The appraiser will determine the value of the home and ensure that it meets the VA’s minimum property requirements. Minimum property requirements have nothing to do with cosmetics, normal wear and tear, minor differed maintenance. They focus on safety, structural soundness and sanitation and legal considerations (zoning, encroachments, local code, etc.).
- Review your closing documents, sign on the doted line and move into your new home!
That’s it. It’s that simple! I hope you found this helpful and if you have any questions or would like to connect, please feel free to reach out. When you are ready, we can start searching for your dream home in Maryland!