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, Veteran’s are Using VA Eligibility More Than Once For A Mortgage Loan.
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.
Hi, I just wanted to ask you some questions about a VA loan. My husband had served in the military and had bought a home with his spouse at the time. They divorced a couple of years later and she got the house. I was wondering since he hasn’t lived at the residence for 8 years and it isn’t in his name, could he qualify for another VA loan? We are unaware of how it works, but he doesn’t believe he can qualify again. Since he doesn’t live there, is the loan still in his name? We bought a home with a loan in just my name, but are planning on moving again for a bigger home. It will be impossible for me to get another FHA loan again I would imagine. What would his credit score have to be? Thank you!
We are talking about a couple of different things here – so let me answer each question. First of all, your husband could likely have partial entitlement. This will qualify him for a VA loan with a small down payment. You can either talk to us, as a lender, to find out how much you have available, or you can contact the Veteran’s Administration directly. You will either need to have his DD214, or his Certificate of Eligibility handy when you contact us or the VA. His “entitlement” was tied up when he purchased the home. When it is sold, he can purchase another home with a value up to 417000 with no down payment, because his entitlement would be released. This is a lifetime benefit.
Secondly, if you are selling your current residence, you can always get another FHA Loan. The minimum credit score for a FHA Loan is 620, although we make loans at 580 and 600 all the time.
We would be happy to help you through this – our number is 919 649 5058