VA Loans

The Florida VA Loan came about in 1944 through the original Servicemen's Readjustment Act also known as the GI Bill of Rights. The GI Bill was signed into law by President Franklin D. Roosevelt and provided veterans with a federally guaranteed home with no down payment. With more than 25.5 Million veterans eligiblef or VA financing, the VA loan is still an excellent source for affordable 100% financing to eligible veterans.

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HOW IT WORKS

VA will guarantee a maximum of 25% of a home loan amount up to $104,250, which limits the maximum loan amount to $417,000. The purchase price, plus the funding fee (2%) may be financed for a combined 102% loan to value.

VA guaranteed loans are made by private lenders, such as banks, savings & loans, or mortgage companies to eligible veterans for the purchase of a home, which must be for their own personal occupancy. The guaranty means the lender is protected against loss if you default on the loan. The guaranty replaces the protection the lender normally receives by requiring a down payment and mortgage insurance allowing you to obtain favorable financing terms.

BENEFITS OF VA LOANS

• TRUE 100% FINANCING (No down payment required)
• Less restrictive credit guidelines than conventional financing
• First time homebuyers allowed
• No mortgage Insurance (this saves hundreds of dollars monthly)
• No income restrictions

VA ELIGIBILITY

• Veterans who served on active duty and have a discharge other than dishonorable after a minimum of 90 days of service during wartime or a minimum of 181 continuous days during peacetime.
• 2 years requirement if the veteran enlisted and began service after September 7, 1980 or was an officer and began service after October 16, 1981
• 6 year requirement for National guards and reservists with certain criteria and there are specific rules concerning the eligibility of surviving spouses
• If you are now on regular duty (not active duty for training), you are eligible after having served 181 days unless discharged or separated from a previous qualifying period of active duty
• If you are an unremarried spouse of a veteran who died whilein service or from a service connected disability
• If you are a spoiuse of a serviceperson missing in action or a prisoner of war
• A surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003, may be eligible

CERTIFICATE OF ELIGIBILITY

The Florida VA Loan program requires the applicatnt to complete VA form 26-1880 along with proof of military service. In some cases it may be possible for VA to establish elibility without proof of service. However, it's best to provide evidence to avoid any possible delays. Acceptable proof of service includes:

• A copy of the veteran's DD form 214 - if the veteran has been discharged or has retired from active military service
• A Statement of Service - the veteran should obtain if still serving on active duty.

As your experienced mortgage professionals at Five Stars Mortgage, we may be able to obtain the certificate of eligilbility for you. Some lenders have acces to the ACE (automated Certificate of Eligibility) system. We will still need proof of service if we can obtain your certificate in this way. Not all cases can be found through the ACE system, only those which the VA has sufficient information on filefor.

If you've had a VA loan before you can re-use your eligibility again as long as the home was foreclosed on in which case the VA would have suffered a loss and would cause you to not be eligible again.

STREAMLINED VA REFINANCE LOANS

IRRRL stands for Interest Rate Reduction Refinancing Loan. You may see it referred to as a "Streamline" or a "VA to VA."

• No appraisal or credit underwriting package is required by VA. You should be aware, however, that some lenders may require an appraisal and credit report anyway.
• A certificate of eligibility is not required. Five Stars Mortgage may use our e-mail confirmation procedure for VA streamlined refinance in lieu of a certificate of eligibility.
• A streamlined VA refinance loan may be done with "no money out of pocket" by including all costs in the new loan or by making the new loan at an interest rate high enough to enable the lender to pay the costs. (Remember: The interest rate on the new loan must be lower than the rate on the old loan unless you refinance an ARM to a fixed rate mortgage).
• You must NOT receive any cash from the loan proceeds.
• A streamlined VA refi be done only if you have already used your eligibility for a VA loan on the property you intend to refinance. It must be a VA to VA refinance, and it will reuse the entitlement you originally used.
• he occupancy requirement for a streamlined VA refinance is different from other VA loans. When you originally got your VA loan, you certified that you occupied or intended to occupy the home. For a streamlined VA refinance you need only certify that you previously occupied it.
• The loan may not exceed the sum of the outstanding balance on the existing VA loan, plus allowable fees and closing costs, including funding fee and up to 2 discount points. You may also add up to $6,000 of energy efficiency improvements into the loan. Adding all of these items into your loan may result in a situation in which you owe more than the fair market value of the house.
• No loan other than the existing VA loan may be paid from the proceeds of the VA streamlined refinance. If you have a second mortgage, the holder must agree to subordinate that lien so that your new VA loan will be a first mortgage.

As you can see there are many benefits to using a VA loan for you're home purchase. The VA Loan Company experts at Five Star Mortgage are ready to facilitate your VA purchase or streamlined refinance today!

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