Pre-Approved VA Home Loans: A Brief Guide To Applying For One

Finding an affordable option amongst the wide range of mortgages can be tough these days, especially when the applicant has a low credit rating or a limited income. But there are options out there, and pre-approved VA home loans offer qualifying applicants one of the most cost-effective mortgage options around.

The VA has long been a source of financial help for former members of the military, and their support when it comes to mortgages means some real savings can be enjoyed. But for the home hunter, securing pre-approved mortgagesoffers other advantages too Denman Prospect. Not least is greater negotiating leverage and the ability to commit to a purchase on the spot.

But how can someone secure a pre-approved VA home loan? And is the process complicated? Here, we provide a step-by-step guide so nothing is missed when it comes to the real thing.

1. Complete The Necessary Forms

The obvious forms to start with when seeking a pre-approved VA home loan is the loan application form. This will request the usual personal and financial details, but if there are any queries, simply leave the area blank and seek advice from the VA loan officer. It is important that all information is accurate and relevant.

A second necessary form is the 26-1880, which confirms eligibility for a VA home loan. This is a simple form that should take no time at all to fill in. However, it is important if there is to be any chance of securing pre-approved mortgages. This form is not needed when an applicant already has a Certificate of Eligibility.

2. Provide Additional Documentation

As well as the forms above, it will also be necessary to produce some additional documentation relating to your income. These include your W-2 form, and perhaps a pay stub. These will provide clear confirmation of your current income, which is obviously essential when applying for a pre-approved VA home loan.

Other documentation that may be requested can confirm other payments, for example any disability payments or retirement payments from the military. These items care covered in a VA Award Letter and Retirement Statement respectively.

3. Credit History Check

It is unavoidable that the loan officer will want to see your credit history – it is a key condition to securing pre-approved mortgages anyway. The check will take a look at your credit report, where details on past loans and repayment patterns can be seen. If there are any defaults, bankruptcies or even repossessions in your history, then they will be found.

Credit scores of around 620 are considered high enough to make VA home loan approval likely, but anything lower than that is likely to prevent any pre-approval. If the application is rejected, then the loan officer is obliged to explain why.

4. Loan Analysis

The last step in our guide refers to the lender checking the details of the proposed mortgage more closely. Getting pre-approved VA home loansis a nice idea, but it still comes down to whether the mortgage is affordable or not.
The lender will examine the information provided, especially income and any existing debts and determine if the loan is affordable or not. If it is then finally securing pre-approved mortgage funds becomes just a formality.

With approval, the lender will send out a Pre-Approval Letter confirming the sum available, which can be handed to property sellers to confirm the funds are available. There will also be some disclosures which need to be signed and sent back immediately, but they are non-binding.

And remember, pre-approved VA home loans are generally valid for 90 to 120 days, which is plenty of time to find your new home.