Articles

No. 1: Not using a VA-savvy real estate agent

If you’re getting a VA loan, make sure you work with a real estate agent who understands the VA home loan process. 

When you’re buying through the Veterans Affairs department, you’ll need to find a home that meets VA home loan property requirements. A VA appraiser will have specific criteria (e.g., fixer-uppers, and even some newer homes, won’t qualify). An agent experienced with home loans for veterans will also know about VA loan limits, the debt-to-income ratio lenders will expect you to have to qualify for a home loan, and other essential information.

Save yourself the headache of making an offer on a house that may not get approved, or for which you may not qualify for a VA loan, and work with an experienced VA agent from the start. Ask another veteran for a referral to find the right real estate agent.

No. 2: Not communicating with your lender

Veterans have access to arguably the most powerful home mortgage option on the market, but about 33% of home-buying veterans don’t know they have a home mortgage benefit, according to the VA. When you first meet with your lender, be sure to discuss your service member status so you can be informed about all of the potential advantages for veterans.

One of the biggest benefits you’ll get with a VA loan is the ability to buy with a 0% down payment. Not having to make a down payment can make it possible for veterans  to buy a first home, often years sooner than if they had to save up for a down payment first. VA loans also come with low-interest-rate mortgages, don't require mortgage insurance, and have more forgiving credit eligibility requirements.

No. 3: Forgetting about all upfront home-buying costs

While you'll have a ton of financial advantages with your VA loan, you will have some borrower costs to deal with. When you’re buying a home, even if you have little or no down payment, you’ll likely have to come up with cash for things like a the appraisal and inspections. It might not cost much in the large scheme of things, but it'll help speed things along if you come prepared knowing what you'll have to pay for up front.

No. 4: Not thinking of your home as an investment

Maybe you think there's no sense in buying if there's a chance you might be relocated in the next few years. But that doesn't mean you shouldn't buy; in fact, that home could end up being a smart investment. By searching in high-demand areas or choosing a popular home style and size, you’ll give yourself a better chance at resale if you need to move later. Or, you can hang on to it and rent it out.

No. 5: Making other big purchases before closing

Once home buyers find a home and their offer is accepted, they can be excited about moving in and making it theirs. Maybe you have an eye on a new big-screen TV, and you're looking into financing a new living room set you love. But don’t do that until you're really a homeowner, even if your lender has approved your mortgage loan. It's easier to get a VA loan than a conventional, non-VA loan, but you still must meet lender requirements. Wait until after closing to make any other financial moves, just to be on the safe side and to keep your loan on track.