Wednesday, June 21, 2023

The Benefits and Risks of Assuming a VA Loan

By: Admin On: June 21, 2023
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    •  A VA loan assumption is when a buyer takes over an existing VA loan, even if they are not eligible to take out a VA loan for themselves. This means that the buyer will assume the terms of the loan, including the interest rate, the monthly payment, and the remaining balance.

    There are a few benefits to assuming a VA loan. First, the buyer may be able to save money on closing costs, as they will not have to pay for an appraisal or a new title search. Second, the buyer may be able to get a lower interest rate than they would qualify for on a conventional loan.

    However, there are also some risks associated with assuming a VA loan. First, the buyer will be responsible for the entire loan balance, even if the property value decreases. Second, the buyer may be subject to the seller's prepayment penalty, if there is one.

    The Benefits and Risks of Assuming a VA Loan

    Overall, whether or not to assume a VA loan is a decision that should be made on a case-by-case basis. The buyer should weigh the benefits and risks carefully before making a decision.

    Here are some of the factors to consider when deciding whether or not to assume a VA loan:

    •     The interest rate on the loan
    •     The remaining balance on the loan
    •     The closing costs associated with the assumption
    •     The prepayment penalty, if any
    •     The buyer's credit score
    •     The buyer's ability to afford the monthly payments

    If you are considering assuming a VA loan, I recommend that you speak with a VA-approved lender to discuss your options. They can help you to assess the risks and benefits of the assumption and to determine if it is the right decision for you.

    How Many Times Can You Use a VA Loan in 2023?

    By: Admin On: June 21, 2023
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    • There is no limit on how many times you can use a VA loan throughout your lifetime, but your entitlement will be reduced each time. Learn more about how VA loans work and how you can use them multiple times.

    For example, if you have a $36,000 entitlement and you use it to buy a home for $200,000, you will have $16,000 of entitlement remaining. If you then use that $16,000 of entitlement to buy a second home for $150,000, you will have no entitlement remaining.

    If you want to use a VA loan again after you have used up your entitlement, you will need to either pay down your current VA loan or apply for a one-time entitlement restoration. To qualify for a one-time entitlement restoration, you must have paid off your previous VA loan and you must still own the property that you bought with the loan.


    Here are some additional things to keep in mind about using a VA loan multiple times:

    •     You can use your VA loan to buy a primary residence, a second home, or a rental property.
    •     You can use your VA loan to buy a condo, a townhouse, or a single-family home.
    •     You can use your VA loan to buy a home anywhere in the United States.

    If you are interested in using a VA loan multiple times, I recommend that you speak with a VA-approved lender to discuss your options.


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    VA loan eligibility 2023

    By: Admin On: June 21, 2023
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    • To be eligible for a VA loan, you must meet the following requirements:

    •     You must be a military service member, a veteran, or the surviving spouse of a military service member.
    •     You must have served on active duty for at least 90 days, or for at least 181 days during peacetime.
    •     You must have been discharged under honorable conditions.
    •     You must have a good credit history.

    In addition to these requirements, you may also be eligible for a VA loan if you were discharged for one of the following reasons:

    •     Hardship
    •     Convenience of the government
    •     Early out
    •     Reduction in force
    •     Certain medical conditions
    •     A service-connected disability

    If you are not sure if you are eligible for a VA loan, you can contact the VA to request a Certificate of Eligibility (COE). The COE will show you if you meet the eligibility requirements and what your VA loan limits are.

    VA loan eligibility 2023


    Here are some additional things to keep in mind about VA loan eligibility:


    •     The VA loan limits vary depending on the location of the property you are buying.
    •     You may be able to get a VA loan even if you have a credit score below 620.
    •     You may be able to get a VA loan with no down payment.


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