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Important Facts for VA Home Loans-& Finding A Good VA Lender

By J Chase

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Published: 08Feb2010
Word count: 508
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Recently, VA mortgage guidelines changed, meaning that borrowers had new information to learn before they applied for a home mortgage loan. These changes weren't a complete overhaul, but they are important. More importantly though are the ways a potential borrower can prepare for their mortgage application as well as the credit factors which can/will affect any mortgage application.

The Veterans Administration as well as any VA mortgage lender will look at certain factors when determining whether or not a borrower is approved for a loan. Here are some of those factors:

Bankruptcy - There are two types of bankruptcy which are most popular for potential home buyers, Chapter 7 and Chapter 13. If you have previously filed for Chapter 7 bankruptcy, VA guidelines stipulate you have to wait at least two years before approval for a VA mortgage loan. If you have previously filed for Chapter 13 bankruptcy, you may still be eligible for a loan with a VA mortgage lender if you are current with all of your payments under the bankruptcy plan.

Credit History - If you have a poor payment history, this could potentially eliminate you from eligibility for a VA home loan. However, if you have good credit or even no credit history at all, you should still be eligible.

Previous Mortgage - If you have a history of late mortgage payments on a previous home mortgage loan, then any potential VA mortgage lender will most likely be dissuaded, as will the VA. However, if you are current with any previous mortgage payments, that should help your status.

Foreclosure - Anyone who has had a home foreclosed on in the past two years is no eligible for a VA home loan according to VA loan guidelines.

Here are some ways you can prepare yourself and your finances before applying for a loan with a VA mortgage lender: Rent/Utilities/Bills - In preparing your credit history, you should make sure you have a steady rent history, that you have utility bills that show you have an address and a good payment history and that you are responsible. In fact, when you first return from service, you may want to rent an apartment for six months to a year in order to build up a quality payment history. This can help you get approved for a loan later on.

Credit - If you have no credit history, it may be beneficial to get a credit card, a cell phone and/or other items that will build a solid credit history. Also, if you have outstanding judgments against you, or if you owe money to collection agencies, then getting those taken care of before applying for a VA home loan can only help you.

Down Payment - It is not necessary to have a down payment for a VA home loan, but even a 5 percent down payment could help get you a lower interest rate. See if you can save up money either by living with relatives for a year or by making some extra money where you are able to.

J Chase is a VA mortgage professional. He is affiliated with a national organization that has helped 1000s of homeowners get the best VA interest rate while financing their property. He has extensive knowledge of the internal & governmental mortgage programs available for homeowners. For information on finding the best VA mortgage lender visit www.weststarvaloans.com

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