If you're a veteran and you're thinking about buying a home, it can seem like a scary and maybe even unachievable process. However, not only can you buy a good home, but they can do so with special programs designed to ease that transition from military life to civilian life. Unfortunately, not all real estate agents or housing markets are aware of the special programs available to you. This post will outline what you need to know about buying a house as a veteran.
While a mortgage loan is the best way to buy a home, it is also a very large debt that must be paid off over time. When you sign the dotted line, you are agreeing to pay back the loan in full, plus interest. The interest rate on your loan is set at the time that you sign the contract and goes with you if you sell the home. As with any loan, the interest rate is an important factor when deciding on a mortgage. However, there are programs that can help reduce your interest rate and make the payment more manageable. One option that is often overlooked is an interest rate reduction refinance loan (IRRRL). As a veteran, you have access to special VA IRRRL programs that can help you lower your monthly payment and save you money over the life of the loan.
Find the Right Real Estate Agent
As a veteran, you might face more scrutiny in the mortgage process because of the federal programs that are designed to help you. You could get “red-flagged” at the beginning of the process for the extra scrutiny and then get passed over for a mortgage by lenders who are worried that they might get audited by the VA. This is where an experienced real estate agent can come in handy. You want someone who understands the unique challenges that you face and can help you work through those challenges. There are some real estate agent groups that are trained and experienced in helping veterans either buy or sell a home. Your agent can make or break your chances of finding a good deal, so choose wisely.
Know the Ramifications
VA loans often require a certain amount of work to be done on the house before the closing. This work can include anything from minor repairs like the painting to more major renovations like installing new kitchens. It’s important to take a look at the house and make a list of everything you want to be done before you close on the house. You want to make sure that your realtor knows what you can and can’t do with a VA loan. Not all repairs will be covered by the loan, so make sure that you get the list before you make any decisions. You should also get a VA-approved appraiser to evaluate the house and tell you if it's worth buying.
If you decide to buy a house that needs renovation, you can use a veteran-only grant to cover the costs. Many of these grants are offered through state housing agencies and come in the form of zero-interest loans. These grants are awarded on a first-come, first-served basis and are often given out to veterans with lower incomes and lower credit scores. If you decide to go this route, you should start the application process early and pay close attention to any deadlines and due dates. If you miss those deadlines, you might miss out on a grant that could help you buy a house.
As a veteran, you likely understand the value of homeownership and have the discipline and perseverance to make it happen. Make sure that you have a budget and timeline in mind so that you can move quickly. By following the right steps early on, you can get into a house that’s right for you and your family.
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