Five Easy Steps to a VA Loan
Overview of the VA Loan Program
A common misconception with the VA Loan program is the amount of "red tape" involved; however, this isn't the case. The application process for a VA Loan mainly differs in the eligibility paperwork and need for a home appraisal, separate from a home inspection. Good news is that most lenders can acquire your Certificate of Eligibility on-line and eligible borrowers can also be processed without a manual underwrite or VA review.
Additionally, if the lender is approved under VA's Lender Appraisal Processing Program (LAPP), the lender may review the appraisal completed by a VA-assigned appraiser and close the loan on the basis of that review. The LAPP process can further speed the time to loan closing.
- Apply for a Certificate of Eligibility. A veteran who doesn't have a certificate can obtain one easily by completing VA Form 26-1880, Request for a Certificate of Eligibility for VA Home Loan Benefits and submitting it to one of the VA Eligibility Centers with copies of your most recent discharge or separation papers covering active military duty since September 16, 1940, which show active duty dates and type of discharge.
- Decide on a home the buyer wants to buy and sign a purchase agreement
- Order an appraisal from VA. (Usually this is done by the lender.) Most VA regional offices offer a "speed-up" telephone appraisal system. Call the local VA office for details.
- Apply to a mortgage lender for the loan. While the appraisal is being done, the lender (mortgage company, savings and loan, bank, etc.) can be gathering credit and income information. If the lender is authorized by VA to do automatic processing, upon receipt of the VA or LAPP appraised value determination, the loan can be approved and closed without waiting for VA's review of the credit application. For loans that must first be approved by VA, the lender will send the application to the local VA office, which will notify the lender of its decision.
- Close the loan and the buyer moves in.