Mount Pleasant 12/16/2015 1:39:12 PM
News / Real Estate

VA Loans are available in Mount Pleasant SC with Wes Sellew of Mortgage Network, Inc.

What you need to know to get a VA Loan

Over the past few years banks lending standards have increased for VA Mortgages or (Veterans Affairs) mortgages.

The VA Loan program is available for to more than 22 million active and veteran military member. VA loans can also be easier to qualify for than a conventional loans because they are a government backed loan.

Although the U.S. Department of Veterans Affairs is not a direct lender. Loans made through private lenders and can be partially guaranteed by the VA, if specific guidelines are followed. Mortgage Network is a lender that offers VA loans for those who qualify.

Here is what you need to know to qualify for the program:


Most members of the military, veterans, reservists and National Guard are eligible to apply for a VA loan. Spouses of military members who died while on active duty or as a result of a service-connected disability may also apply.

Active-duty members generally qualify after about six months of service. Reservists and members of the National Guard must wait six years to apply, but if they are called to active duty before that, they gain eligibility after 181 days of service.

Reservists, members of the National Guard and active-duty members generally are eligible after 90 days of service during war periods.

Potential borrowers must obtain a certificate of eligibility before applying for a loan.

Advantages of a VA loan

For most people, the days of no-down-payment mortgages are long gone, but not for veterans. Loans guaranteed by the VA can be obtained without any down payment.

"This is incredibly power and helps many Military personnel who otherwise do not have a down payment get a loan. This is a huge plus." say Wes Sellew, Branch Manager, Mortgage Network.

Another plus: A VA loan doesn't require mortgage insurance, as do Federal Housing Administration and conventional loans with less than 20 percent down payment. The benefit translates into significant monthly savings for VA borrowers. For instance, a borrower who takes a $200,000 FHA-insured mortgage could pay more than $200 a month for mortgage insurance alone." With a VA loan, the reserves required are lower than all the money you would have to save for a conventional loan," Sellew says.


Although the costs of getting a VA loan are generally lower than other types of low down payment mortgages, they still carry a one-time funding fee that varies, depending on the amount of the down payment and the type of veteran.

A borrower in the armed forces getting a VA loan for the first time, with a zero down payment, would pay a fee of 2.15 percent of the loan amount, Sellew says. The fee is reduced to 1.25 percent of the loan amount if the borrower makes a 10 percent down payment.  Reservists and National Guard members normally pay about a quarter of a percentage point more in fees than active-duty members pay.

Those using the VA loan program for the second time, without a down payment, would pay 3.3 percent of the total loan amount.

"However, Military members receiving disability compensation could have the fee waived," Sellew says.

Underwriting requirements

While Veterans Affairs does not require a minimum credit score for a VA loan, Lenders generally have their own internal requirements. Most lenders ask for a credit score of 620 or higher, Sellew says.

Borrowers must show sufficient income to repay the loan and shouldn't have excessive debt, but the guidelines are usually more flexible than for conventional loans.

"Since this is a benefits program there is some flexibility, however, our underwriters still have to do their due diligence" Sellew says. VA guidelines allow veterans to use their home-loan benefits a year or two after bankruptcy or foreclosure. "We will look at the whole credit picture, what was the reason for the credit bankruptcy and where the borrower is now," Sellew says. VA loans are available only to finance a primary home. A VA loan cannot be used to purchase or refinance vacation and investment homes. The limit on VA loans vary by county, but its $417,000 in most parts of the country and up to $1,094,625 in high-cost areas.

To see if you qualify for VA Loan in the Mount Pleasant, South Carolina area, contact Wes Sellew at Mortgage Network today for a Free Consultation.

(843) 800.3003