6 of the Most Important VA Loan Tips for VA Homebuyers
Tip 1: Start Now
You don't need to have your VA Certificate of Eligibility to start the VA loan process. You can start contacting VA approved lenders to start the prequalification and preapproval process right now because it doesn’t make sense to start looking for homes before you've got a clear sense of what you can afford and how much a lender is likely to extend.
Tip 2: Know Your Credit Report, Wait for Your Credit Score
Get a legit free copy of your credit report and go through it carefully because about a quarter of reports have errors that could derail you getting approved for a home loan altogether. But don’t confuse your credit report with your credit score, and don’t waste your money paying to see it. Lenders see different scores than consumers using a formula weighted for mortgage lending, so the only way to really know where you stand is to have the lender do it when the time comes. And don’t worry about lenders’ “hard inquiries” destroying your credit because credit bureaus treat multiple inquiries from mortgage lenders within a month or so as just one single pull, rather than have each one possibly drag down your score. It's always a good idea to compare costs, loan rates and terms from multiple lenders.
Tip 3: Stay on Budget
That preapproval amount isn’t your budget, it’s your ceiling. Homeownership comes with a slew of expenses like homeowners insurance and property taxes to maintenance costs and everything in between. Looking for a new place to live can be fun, but this ain’t Monopoly, people!
Tip 4: Find a VA-Savvy Agent
As much as your cousin’s cousin Frank may want to break in his new realtor’s license, just say no. VA loans are a specialized product that some real estate agents and lenders know more than others. For example, a good real estate agent who understands the VA program can help you avoid properties that are likely to pose problems during the appraisal process.
Tip 5: You’ll Need Some Cash Money on Hand
You will need money up front to cover things like an earnest money deposit, the appraisal, and the home inspection, even though you may get all of that money back at the closing table.
Tip 6: Someone Has to Live There Soon
The VA program dictates that the property has to be occupied within 60 days of closing, but this includes a spouse, so don’t worry about an upcoming deployment or international contract obligations as long as one spouse can stay behind.