VA loans for eligible veterans are a wonderful way to get into your dream house with no down payment as well as to obtain very low interest rates. Unfortunately, not all situations are within the standards of what the VA will approve. Because real estate today has many different options, it pays to know what your VA eligibility will allow you to purchase, allowing you to take advantage of the great loan program that you have access to as a part of our country’s military.
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Single Family Homes are the VA “Favorite”
Typically a single family home will win the approval of the VA without too much trouble. The home must be able to pass the VA appraisal, which if you are purchasing an existing home, can cause a little anxiety. Basically the VA is looking for homes that are safe and healthy. The appraisal that is completed is an in depth exam of the home to determine its value as well as its livability. To put it into layman’s terms, the VA is looking for a home that can be moved into now, without any changes to the home. They basically look to ensure that all major functions of the house, including the plumbing, heating and cooling are in working condition; that there is no sign of water damage or mold growth; that there is no evidence of the use of lead based paint or that there is no termite infestation. The appraisal will also deem an appropriate value for the home, which helps guide the lender when determining the appropriate amount of money to loan you to purchase the home.
Condos or Townhouses are Oftentimes Approved for a VA Loan
Many people have heard horror stories about trying to get a loan approved for a condo or townhouse. Luckily, VA loans are typically approved for these types of homes, with a few restrictions of course. The largest caveat to gaining approval for a VA loan for a condo or townhome is the need for the entire complex to be approved by the VA. Now luckily, many complexes are already on the approved list, which makes it easy for you to obtain your loan. If, however, you find a condo or townhome in a complex that is not yet approved, your lender will need to get it approved, which is a lengthy and difficult process. The VA will need all pertinent information regarding the complex, its parking structures, homeowners’ association, title, insurance and organizational policies before it can approve or deny the complex.
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Modular Homes are Sometimes Approved for a VA Loan
Modular homes are those homes that are built in sections. The prefabricated sections are completed at the factory and then the pieces are put together at the site of where your home will exist by your contractor. As with any home, there are certain guidelines that modular homes need to follow when being built in order to gain VA approval, but for the most part they are approved. It is best to talk to your lender about your specific project before getting started to ensure that you will have the financing that you need to close on the purchase of your modular home.
Mobile Homes are Sometimes an Issue with the VA
Mobile homes are difficult to get financed for almost any type of loan simply because they typically depreciate rather than appreciate. Lenders stand to lose a significant amount of money on these types of loans because of this fact. If you are lucky enough to find a lender that is willing to provide financing for a mobile home, it will also need to meet certain requirements of the VA. Of utmost importance is its size and permanent fixture to the ground. Single wide mobile homes must be at least 400 square feet and double wides must be at least 700 square feet. All important areas of any home, such as sleeping quarters, bathroom facilities and a place to cook must also be permanent in the home.
The best way to ensure that your home will be approved by the VA for a VA loan is to talk to your lender before you begin shopping for a home. Since it is a good idea to get preapproved for a loan before you shop for a home anyways, it is the best time to discuss the type of home that you should stick to in your search. If you know that you want a mobile home, you might have to search high and low for a lender that is willing to provide financing for it. If you are in the market for a condo or single family home, you will have more leeway in which lender you choose, but it still makes sense to consult with them beforehand to save yourself headaches in the future.
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