Purchasing a home for the first time is one of life’s most exciting and meaningful milestones, but it can also be daunting, particularly if you are doing it for the first time. Rest assured, for U.S. veterans of the military, including those who are currently serving, or eligible surviving spouses, the VA loan program can bring the dream of owning a home a little closer to reality.
Let’s go over all you need to know for a first-time home buyer who wants to use a VA loan from eligibility and benefits to some key tips to get you started feeling confident.
First-Time Buyer VA Loan Eligibility
As a first-time homebuyer, to be eligible for a VA loan you usually must serve in one of the following capacities:
- Served 90 consecutive days of active service during wartime
- Served 181 days of active service during peacetime
- Served 6 years in the National Guard or Reserves
- Are the spouse of a service member who died in the line of duty or as a result of a service-related disability
You will also have to acquire a Certificate of Eligibility (COE) that verifies your VA loan eligibility.
What Homes Qualify for a VA Loan?
Some homes do not immediately meet the VA’s minimum property requirement. The home has to comply with VA Minimum Property Requirements, which are a list of standards maintained by the VA to ensure homes are safe, structurally sound, sanitary, and more. That includes functional utilities, good roof and reasonable access to the property.
Before you go falling in love with a home, verify that it meets these requirements or can be, as the case may be, repaired to conform to VA standards.
Benefits of Buying as a First-Time VA Buyer
A VA loan is a great benefit for first-time home buyers under the program of which the financial cost of home ownership is much lower. There are several key benefits:
- No upfront payment needed: You can purchase a home without the need to save tens of thousands of dollars.
- No PMI: Dodging monthly or upfront expensive coverage just because you put less than 20% down.
- Looser credit requirements: VA lenders may approve borrowers with credit scores of 580–620 and up.
- Limits on closing costs: The VA limits the types of fees you can be charged, which can help you save at the closing table.
Those benefits make a VA loan even more enticing to first-time buyers who may not have much money saved up or an extensive credit history.
Finding the Right Home
Finding a property that fits your needs while balancing your budget is one of the first steps toward homeownership. Military buyers can, however, view websites that feature VA Loan Homes for Sale and qualify for VA financing. With these listings, searching for a home should be easier and will help to avoid falling in love with a home that doesn’t make the cut.
So whether you are seeking an easy-care beach apartment or a family home in the suburbs, or a home near a military base, narrowing in on VA-approved properties can simplify the home buying process.
Can I Use a VA Loan for a Rental Property?
The answer is it depends. Your VA loan needs to be for your primary residence, not an investment property. Yet there’s a workaround that is strategic: You can buy a multi-unit property (up to 4 units in size) with a VA loan as long as you occupy one of the units. That allows you to generate rental income and stay on the premises, a good deal for first-time homebuyers trying to make some long-term equity.
Find out how you can structure this by reading about the VA Loan for a Rental Property benefits of VA Rental Property Financing excite Lenders By using the VA Loan, veterans and active military personnel can find a place to call home for themselves or their family members.
Building Your Dream Home with a VA Construction Loan
If available homes don’t work for you, you might also think about building your first home. The VA Construction loan can also finance the land, site improvements, and construction permanent loan in one loan! This “One-Time Close” process is perfect for first-time buyers who desire a home tailored to their specifications.
Note: Not all lenders provide VA construction loans, so make sure to select a lender that focuses on this niche product.
Get Expert Help: Find a Realtor Who Understands VA Loans
A good real estate agent can be a lifesaver. Not all Realtors have experience with VA loan guidelines, so you’ll want to choose a Realtor who knows the ins and outs of the VA loan process.
A seasoned VA-friendly agent, on the other hand, can assist you with:
- Identify eligible properties
- Avoid homes that won’t pass VA inspections
- Negotiate seller-paid closing costs
- Ensure your offer is competitive
They’ll be your advocate in the deal, keeping things stress-free, and increasing your likelihood of success.
Final Tips for First-Time VA Buyers
Here are some additional words of advice for first-time VA homebuyers:
- Begin shopping with pre-approval: It will signal to sellers that you’re a serious buyer and can afford the home.
- Plan for closing costs: The VA officially restricts what lenders can charge, but there will still be some costs you’ll have to pay out of pocket.
- Don’t skip the inspection: A home inspection isn’t included in the VA appraisal, and it’s your best defense for finding out what’s wrong with a place before you buy it.
- Here are some tips for finding and buying a home with a VA loan: Know your limits The VA doesn’t limit how much you can borrow, but it does limit how much the agency can guarantee you.
- Learn occupancy rules of thumb: You intend to live in the home within 60 days of closing.
Conclusion
Purchasing your first home as a service member or veteran is an incredibly empowering experience especially when you maximize your VA loan benefits. By requiring no down payment and permitting more flexible credit standards than conventional mortgages, they provide a way for military people to afford homes when they are returning from their deployments.