The VA Home Loan
by Noah Perkins
( CMS, VA Home Loan Centers)
Military members and their families face a unique set of challenges during active duty service, the transition to civilian life and beyond as veterans. Active duty personnel, in addition to the emotional distress of long deployments, are subjected to frequent Permanent Change of Station orders, on average, every two to four years. Annually, 700,000 military members relocate. It would stand to reason that life would get easier following the conclusion of service, often the reverse is true. Of 200,000 military that leave service yearly, rates of PTSD, unemployment and underemployment are inordinately high. Compounding these issues is the number of homeless veterans. The National Coalition for Homeless Veterans estimates that on any given night 300,000 vets are on the street.
Many of our bravest men and women endure the same troubling cycle; during service, low pay leads to high debt, creating a pattern of instability. The period immediately following service is complicated by a challenging job market and an unwillingness of many employers to hire qualified veteran applicants. In 2012, CNAS, interviewing 69 different companies, found that 80 percent of respondents did not believe military skills properly translate into the business world, while many stated an apprehension to hire former service members citing the belief that a large number are potential PTSD sufferers. Underemployed or unemployed, these men and women are saddled with financial burdens, in too many instances unmanageable monetary issues lead to dire consequences including homelessness.
Stability is the catalyst for a seamless progression into civilian life. Fortunately, many great benefits are available to active duty personnel and veterans. Ranging from subsidized health care to educational assistance and everything in between, perhaps the most advantageous entitlement is the VA Home Loan. For borrowers looking to buy a house this is the perfect option. The popularity of this loan has dramatically increased over the past decade. In 2004 only two percent of all mortgages were purchased using the VA Loan, compared to eight percent this year.
The appeal of the VA Home Loan stems from lower interest rates, lax underwriting guidelines, 0 dollars down and 100 percent financing. A common mistaken belief attributed to this loan is that it can only be used once. As long as the applicant is currently up to date on all payments, they maintain their eligibility. Furthermore, vets and active duty military members who have previously foreclosed or completed a short sale may still qualify, contingent on up to date debt payments.
Eligibility is determined by length of service. 90 days during war and 181 during peacetime, an honorable discharge is required.
CMS, VA Home Loan Centers
VA Home Loan Centers is a Department of Veteran Affairs sponsored third party organization, working to find active duty service members and veterans’ affordable housing. Upside-down military homeowners short selling are given the services provided by VA Home Loan Centers at no cost to them.
More information can be found here.