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Who Is Eligible For A VA Loan In Houston, Texas?

November 1, 2022 | By Shoshana Simones

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Houston is a great place to live, and eligible veterans can get a VA loan to purchase their dream home in the area. VA loans are backed by the United States Department of Veterans Affairs and provide benefits that other mortgages don't offer.

To help you determine the best way to purchase a home, we'll cover who is eligible for a VA loan in Houston and what the qualifications are. We will also compare VA loans to traditional mortgages and answer some common questions about these unique mortgages. If you're thinking of buying a home in Houston, be sure to read this blog post!

What Is A VA Home Loan?

VA home loans are mortgages that are backed by the United States Department of Veterans Affairs. These loans are available to eligible veterans, service members, and their surviving spouses.

The VA home loan program was started in 1944 as a way to help veterans returning from World War II purchase homes. Today, these loans are still available and can be used to purchase a primary residence, including a condominium unit, a manufactured home, a modular home, or multi-unit property.

VA loans offer a number of benefits that other loans don't. For example, VA loans don't require a down payment or private mortgage insurance, and they have lower interest rates than other types of mortgages.

Who's Eligible For A VA-Backed Loan?

In order to be eligible for a VA loan, you must be a veteran, service member, or surviving spouse who meets specific criteria. For veterans and service members, you must have served on active duty for at least 90 days during wartime or 181 days during peacetime.

For surviving spouses, you must not have remarried after the death of your servicemember spouse. Additionally, you must meet one of the following criteria:

- You are eligible for Dependency and Indemnity Compensation (DIC) from the VA

- You are eligible for survivor benefits under the Veterans' Group Life Insurance program

- You were married to your servicemember spouse for at least one year

- You would be eligible for DIC if your spouse had died on active duty

What Are The Qualifications For A VA Loan?

In addition to meeting the eligibility requirements, you must also meet certain qualifications for a VA loan. These qualifications include having a satisfactory credit history, sufficient income, and a valid Certificate of Eligibility (COE).

The COE is proof that you meet the eligibility requirements for a VA loan and can be obtained through your lender or the Department of Veterans Affairs. To apply for a COE, you will need your DD-214 or other discharge documents.

The income requirements for a VA loan vary depending on the number of people in your household and the county in which you live. In general, though, you will need to have a steady income that meets the VA's guidelines.

Lastly, you must have a good credit history in order to qualify for a VA loan. The VA uses a process called "credit underwriting" to determine if you're eligible for a loan. This process looks at your credit history, employment history, and other factors to determine your eligibility.

How Do I Prove To The Lender That I'm Eligible?

If you're eligible for a VA loan, you'll need to obtain a COE from the Department of Veterans Affairs. You can then take this COE to your lender as proof of your eligibility.

Are There Any Restrictions For VA Loans?

There are some restrictions for VA loans, such as the type of property you can purchase. Eligible veterans can use a VA loan to buy a single-family home, condominium, manufactured home, or multi-unit property. You can also use a VA loan to finance the construction of a home.

Unfortunately, you cannot use a VA loan to purchase an investment property or a second home. Additionally, you cannot use a VA loan for a cash-out refinance.

How VA Home Loans Compare To Traditional Mortgages

VA loans offer several benefits that traditional mortgages - i.e., conventional loans- don't. For example, VA loans don't require a down payment, and there is no PMI. Additionally, VA loans have lower interest rates than conventional loans.

Are VA Loans Good For Buying Your First Home?

Yes! eligible veterans can use a VA loan to buy their first home. VA loans offer several benefits, such as no down payment and lower interest rates, that make them a great option for first-time homebuyers.

Additionally, eligible veterans can use a VA loan to finance the construction of a new home, which can appeal to first-time homeowners looking to create their dream home for their families.

Can A Person Get A 20-Year VA Loan?

Yes, eligible veterans can get a 20-year VA loan. A 20-year VA loan offers the same benefits as other VA loans, such as no down payment and lowers interest rates. However, keep in mind that with any 20-year loan, your monthly mortgage payments will be higher than with a longer loan.

Do I Need To Purchase Private Mortgage Insurance For My VA Loan?

No, you don't need mortgage insurance (PMI) for a VA loan. This is one of the many benefits of the VA loan program!

However, there are still some other costs associated with any loan. For example, VA loan closing costs are typically 1-5% of the total loan amount. Part of the reason VA closing costs have such a broad range is that the VA funding fee can be anywhere from 0.5% to 3.6% of the loan amount, depending on your mortgage loan type.

What If The Appraised Value Is Below The Sales Price Of A New Construction Home?

If the appraised value is below the home's sales price, the borrower may still be eligible for a VA loan. The borrower would need to make up the difference in cash or through a second mortgage.

To do this, the borrower would need to get an "as-built" appraisal, which appraises the home at its current value. The appraised value would then be used to determine the loan amount.

Finding A Lender To Get Started

If you're eligible for a VA loan, the next step is to find a lender. You can find a list of eligible lenders on the Department of Veterans Affairs website. A VA-approved lender like Texas United Mortgage is vital to getting the best deal on your Texas VA loan.

Our experienced loan experts will help you understand VA loan limits and VA loan service requirements to make sure you don't miss a step. We'll help you to get pre-approved for a loan, or if you have an existing VA loan, we can help you refinance. The pre-approval process will involve the lender reviewing your financial information and credit history.

Eligibility is just one part of the equation when it comes to getting a VA loan. You also need to meet certain qualifications and find an eligible lender. But if you're eligible and qualified, a VA loan can be a great option for financing your home in Houston!


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