Fact Sheet on VA Guaranteed Loans

What is a VA Guaranteed Loan?

VA guaranteed loans are made by private lenders, such as banks, savings & loans, or mortgage companies to eligible veterans for the purchase of a home which must be for their own personal occupancy. To get a loan, a veteran must apply to a lender. If the loan is approved, VA will guarantee a portion of it to the lender. This guaranty protects the lender against loss up to the amount guaranteed and allows a veteran to obtain favorable financing terms. There is no maximum VA loan but lenders will generally limit VA loans to $417,000 This is because lenders sell VA loans in the secondary market, which currently places a $417,000 limit on the loans. For loans up to this amount, it is usually possible for qualified veterans to obtain no down payment financing. A veteran's basic entitlement is $36,000 (or up to $104,250 for certain loans over $144,000). Lenders will generally loan up to 4 times a veteran's available entitlement without a down payment, provided the veteran is income and credit qualified and the property appraises for the asking price.
Note: For properties in Hawaii, Guam, Alaska and the U.S. Virgin Islands loan limits can be up to $625,000

VA Loans Offer the Following Important Features:

• Equal opportunity for all qualified veterans to obtain a VA loan.
• No down payment (unless required by the lender or the purchase price is more than the reasonable value of the property).
• Buyer informed of reasonable value.
• Negotiable interest rate.
• Ability to finance the VA funding fee (plus reduced funding fees with a down payment of at least 5% and exemption for veterans receiving VA compensation).
• Closing costs are comparable with other financing types (and may be lower).
• No mortgage insurance premiums.
• An assumable mortgage.
• Right to prepay without penalty.VA assistance to veteran borrowers in default due to temporary financial difficulty.

VA Does Not do the Following:

• Guarantee that a home is free of defects. VA guarantees only the loan. It is the veteran's responsibility to assure that he/she is satisfied with the property being purchased. The VA appraisal is not intended to be an "inspection" of the property. A veteran should seek expert advice (a qualified residential inspection service), as necessary, BEFORE legally committing to a purchase agreement.
• If you have a home built, VA cannot compel the builder to correct construction defects although VA does have the authority to suspend a builder from further participation in the home loan program.
• VA cannot guarantee that a veteran is making a good investment.
• VA cannot provide a veteran with legal services.

How Does a Veteran Obtain a VA Guaranteed Loan?

• Contract to purchase: Veteran selects home and discusses purchase with seller or selling agent and signs purchase contract conditioned on approval of a VA guaranteed loan.
• Loan application: Veteran selects lender, presents Certificate of Eligibility, and completes loan application. Lender will develop all credit information and request VA to assign a licensed appraiser to determine the reasonable value for the property. Veteran will pay for credit report and appraisal unless the seller agrees to pay. Either VA or the lender will issue a value for property for loan purposes based on the appraisal.
• Loan decision: If the established value is acceptable to all parties and the lender develops that a veteran is credit and income qualified, the loan may be approved. Most lenders are authorized to make this decision.
• Loan closing: Veteran (and spouse) attend the loan closing and sign the note, mortgage, and other related papers. The lender or closing attorney will explain the loan terms and requirements as well as where and how to make the monthly payments.

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Home of Loan John - 410 S. State St. - Davison, MI 48423
Office Phone: (810) 654-2525 Fax: (810) 654-9825 Toll Free #: (866) LOAN JOHN

Home of Loan John and a member of the Symphony Homes family of companies offers mortgage services in the following areas: GENESEE COUNTY, LAPEER COUNTY, OAKLAND COUNTY, MICHIGAN, ATLAS, BURTON, CLIO, DAVISON, FENTON, FLINT, FLUSHING, GOODRICH, GRAND BLANC, MONTROSE, MUNDY, RICHFIELD, AND SWARTZ CREEK.  Mortgage loans are also provided in LAPEER, CLARKSTON, HOLLY, LAKE ORION, NOVI, OXFORD, PONTIAC, ROCHESTER, ROCHESTER HILLS, TROY, AND WATERFORD.  Copyright 2001 - 2008 Loan John and Real Estate One Symphony Homes.  Our American Government Mortgage and Loan programs provides clients with FHA, VA, and Reverse Mortgage services. Be sure to ask about our revolutionary TRADE IN PROGRAM!  That's right, now you can TRADE IN YOUR OLD HOUSE FOR A BRAND NEW SYMPHONY HOME! Call (810) 658-3600 for more information. NEW HOMES ON OUR LOT OR YOURS! Symphony Homes is a new homes Michigan builder in Genesee and Oakland County currently building in several new home communities including Burton, Davison, Goodrich, Grand Blanc, and Lake Orion!  New home styles feature single family detached homes and condominiums. Complete loan and financing services are now available through our mortgage partner,  HOME OF LOAN JOHN).  Call (810) 654-2525 to speak with one of our mortgage experts!  Symphony Homes is proud to be a REAL ESTATE ONE affiliate! SEARCH THE MLS for all homes in the state of Michigan by accessing the MULTIPLE LISTING SERVICE directly from this site! Also, be sure to visit THE VALUE PLAY for powerful real estate software, audio CDs featuring author Steve Berges, and business, real estate, and legal forms! Tired of paying high gas prices? Then be sure to visit THE GAS SAVER to learn how you can begin saving $$$ now!

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