Eligibility For VA Mortgage

Already Used Veteran’s Eligibility to Purchase A Home?

November 28, 2011 By admin Leave a Comment

People moving to Ft. Bragg, in Fayetteville NC might be moving here with little or no equity. Did you know that even if you’ve used your VA eligibility before, you can use it more than once… under certain circumstances.

You need to either:

Pay off your prior VA loan (for instance, sell the property)
The VA allows a one-time only basis, you may have your eligibility restored if your prior VA loan has been paid in full but you still own the property.

In either case, to obtain restoration of eligibility, the veteran must send a completed VA Form 26-1880 to the local VA Center. (In NC the Eligibility Center is in Winston Salem.) We suggest that Veterans include evidence that the previous loan is paid in full with a notice from the bank, and a copy of your HUD-1 Settlement Statement. Including this information will speed up the process, and you will avoid days of delays!

If you allowed the folks who purchased your home to assume your VA loan, you can still get the Eligibility Reinstated. In the case of an assumption, your Eligibility will be restored if the person who assumed the loan is also an eligible veteran, and they are willing to substitute his or her available eligibility for yours. This means the person purchasing your home with an assumption, has to qualify for a VA mortgage for you to be eligible for a NEW VA Mortgage Loan.

If you allowed someone to assume the VA Home Loan, and they defaulted, or the Federal government lost money AT ALL, you will not have your VA Eligibility restored. Even if it’s not your fault, and the VA does not hold you responsible.

The same thing is true if you short sold your home, or did a deed in lieu. If the VA lost money, they will not reinstate your Eligibility. Although you might be released from liability on the loan and/or the debt was waived, our experience is that the VA will not restore the Eligibility.

We’ve been told pretty sternly that “The law does not permit the used portion of the veteran’s eligibility to be restored until the loss has been repaid in full.”

If you are considering a home purchase in NC, and have questions about your Veteran’s Eligibility – please call Steve Thorne 919-649-5057, NC’s Veteran Home Loan Expert! If you want to know VA Home Loan Qualifying basics, click here.

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Who Qualifies for VA Mortgage Loans

October 20, 2008 By Eleanor 7 Comments

The VA, has offered 100% mortgage loan financing to Veterans for many years. It is one of the best benefits a Soldier has. If you are serving in time of War, the length of time in the service, before you are you are eligible for VA home loan is much shorter.

Because there are varying rules applied for soldiers that served in War and Peace times, we wanted to highlight the requirement for veterans who served on active duty in the Army, Navy, Air Force, Marine Corps, or Coast Guard and were discharged under conditions other than dishonorable after either:

90 days or more, any part of which occurred during wartime, OR
181 continuous days or more (peacetime)

Like All Things with the Government – It couldn’t be That Simple… So there’s a TWO YEAR RULE that states:

If you:

enlisted (and service began) after September 7, 1980, OR
were an officer and service began after October 16, 1981

You must have completed either:

24 continuous months or more, OR
the full period for which ordered to active duty, but not less than 90 days (any part during wartime) or 181 continuous days (peacetime)

What Constitutes War Time versus Peace Time?
Wartime and Peacetime, as used in the General Rule for Eligibility, refer to the following periods of time:

Wartime	Peacetime
World War II 9/16/40 – 7/25/47	Post-World War II period 7/26/47 – 6/26/50
Korean conflict 6/27/50 – 1/31/55	Post-Korean period 2/1/55 – 8/4/64
Vietnam era 8/5/64* – 5/7/75	Post-Vietnam period 5/8/75 – 8/1/90
Persian Gulf War 8/2/90 – undetermined

were discharged for a service-connected disability, or
were discharged for the convenience of the government after completing at least 20 months of a 2-year enlistment, or
completed not less than 90 days (any part during wartime) or 181 continuous days (peacetime), and

were discharged because of a hardship, or
were determined to have a service-connected compensable disability, or
were discharged or released from active duty for a medical condition which pre-existed service and has not been determined to be service-connected, or
received an involuntary discharge or release from active duty for the convenience of the Government as a result of a reduction in force, or
were discharged or released from active duty for a physical or mental condition not characterized as a disability and not the result of misconduct but which did interfere with your performance of duty

are an unremarried spouse of a veteran who died while in service or from a service connected disability, or
are a spouse of a serviceperson missing in action or a prisoner of war.

Active Duty???
If you are currently on active duty, you are eligible after having served on continuous active status for at least 90 days. When an ending date is established for Persian Gulf War service, a minimum of 181 days of continuous active duty will be required for persons who did not have wartime service.

If you are a Member of the Selected Reserves:
“Selected Reserve” means the Selected Reserve of the Ready Reserve of any of the Reserve components which consists of units and individuals who participate actively in paid training periods and serve on paid active duty for training each year.

SIX Year Rule:
A veteran, who is not otherwise eligible, who completes a total of 6 years as a member of the Selected Reserve (need not be ordered to active duty) is eligible if he or she either:

received an honorable discharge
was placed on the retired list
was transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service in the Selected Reserve characterized as honorable
continues to serve in the Selected Reserve

The 6 years service need not be continuous nor in the same Reserve or National Guard unit. However, active duty regular military service cannot be combined with Reserve service to reach the 6 year requirement.

certain United States citizens who served in the armed forces of a government allied with the United States in World War II.
individuals with service as members in certain organizations, such as Public Health Service officers, cadets/midshipmen at service academies, officers of National Oceanic and Atmospheric Administration, merchant seamen with WWII service, and others.

** Please Note: The VA has the final authority on issuing eligibility **

If you are considering a VA home loan – please call us! Steve and Eleanor Thorne 919-649-5057

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VA Loan Co-Signors

May 20, 2008 By Eleanor 6 Comments

wedding VA mortgage loan guidelines recognize legally married spouses of qualified veterans as co-signors on VA loans. This means that we can include the spousal income to qualify for the loan, and that these loans can be fully guaranteed by the VA. Simply being engaged means that you can get pre-qualified with the spousal income, but the closing must take place after we have evidence of the marriage.

The VA mortgage loan guidelines also allow for more than one eligible veteran(s) to purchase a home. If a married couple with more than one eligible veteran is involved, VA divides the entitlement charge equally between them, if possible. If two unmarried eligable veterans purchase property together the same rules apply and these loans can be fully guaranteed by the VA.

While the VA guidelines may allow for a non-veteran to co-sign for a mortgage loan, they will not fully guarantee the loan, and in our 25 years of lending, we’ve never seen one of these loans close. Again, the VA mortgage loan was designed to offer long-term financing to American veterans or their surviving spouses (provided they do not remarry).

Although it seems more confusing than it is, the federal government does not generally make direct loans under the act. The government simply guarantees loans made by ordinary mortgage lenders (descriptions of which appear in subsequent sections) after veterans make their own arrangements for the loans through normal financial circles. The Veterans Administration then appraises the property in question and, if satisfied with the risk involved, guarantees the lender against loss of principal if the buyer defaults.

In the case of divorce, the Veterans Administration has several choices. If a non-eligable spouse continues to occupy the property and if the payments are made in a timely fashion, no change to the loan will be made. In this case, the military spouse will have their eligability for a mortgage re-instated once the loan is paid off and/or refinanced out of a VA loan. If payments are missed, and the property is approaching foreclosure, the VA might choose to refund the loan and have the payments made directly to the Veteran’s Administration.

For more information about purchasing a home in Raleigh with VA Financing or buying a home in Cary as a Veteran, please contact Steve and Eleanor Thorne with Connect With Us on Facebook in Cary, NC. 919-649-5058