What are VA Loans?

The United States Department of Veterans Affairs, known as the VA, offers a number of benefits to veterans and active duty members of the military, including VA loans, home loans which are guaranteed by the government. The VA itself does not lend out the money, instead offering surety to the lender. People can get VA loans from a wide variety of mortgage lenders, either by approaching the lender directly or using the services of a mortgage broker who may opt to shop the file around to several lenders to find the best deal.

There are a number of advantages to using VA loans which make them appealing to people who are eligible. First of all, many VA loans come without the obligation of a down payment, although people can certainly opt to put in a down payment if they so choose. These loans also typically have a lower rate of interest. While eligibility for a VA loan will not guarantee that someone can get a loan, lenders may consider people who are otherwise marginal candidates for a home loan if they have VA backing, because the risk to the lender is greatly reduced.

Active duty members of the military who have been serving for at least 90 days in wartime or 181 days in peacetime are eligible for VA loans, as are veterans who completed their military service and were discharged honorably. People who were discharged before their term of service were over are still eligible as long as they fulfilled the 90/181 day minimum requirement and they were discharged honorably, as in the case of someone who was disabled in the course of serving in the United States Military.

Surviving partners of deceased members of the military and spouses of permanently disabled veterans are also eligible for VA loans. Eligibility is certified with a form from the VA. Veterans and active duty military can apply for the form directly, or they can submit a form through their lenders.

As a general rule, the maximum amount of a VA loan as of 2009 is $417,000 United States Dollars (USD), although it is slightly higher in certain areas, such as California and Hawaii. The home must be purchased as a primary residence for occupancy by the veteran, and it must be in the United States or an American territory or possession. It is possible to obtain multiple VA loans, as in the case when a veteran sells a home and wishes to buy a new one.