The VA Loan Process: Explained

Discover the nine important steps of the VA loan process to smoothly navigate your VA homebuying journey.
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The VA home loan is a well-known benefit created to assist Veterans, active-duty service members and surviving spouses in achieving homeownership. The process of securing a VA-backed mortgage might seem overwhelming for some eligible borrowers.

However, The Military Wallet is here to help! Whether you’re a first-time homebuyer or have navigated the real estate market before, understanding the intricacies of the VA loan process can pave the way for a smoother, more informed journey to homeownership.

The VA Loan Process: Step-by-Step

The 9 Steps of the VA Loan Process

1. Obtain a Certificate of Eligibility

2. Choose a trusted VA lender

3. Apply for preapproval

4. Find your potential home

5. Make an offer

6. VA appraisal

7. Underwriting

8. Closing

9. Move in

Step 1: Obtain a Certificate of Eligibility

First, you’ll need a Certificate of Eligibility (COE). This certificate proves that you served in the military and are eligible for a VA loan. To get a COE, you can ask the VA or your VA lender for help. You’ll have to provide documentation like your discharge paperwork or other proof that you served.

Step 2: Choose a Trusted VA Lender

Choosing a dependable VA lender is essential. VA loans can be tricky, but with the right lender who knows government-backed loans, you’ll be in good hands. Make sure you take time to do research and compare multiple lenders.

You can explore resources like our dedicated page on the best VA lenders to identify those with a strong track record in handling VA loans. This decision is pivotal, as the lender you choose will serve as your primary point of contact throughout the VA loan process, providing expert advice and guidance tailored to your needs.

Step 3: Apply for Pre-Approval

A preapproval letter not only communicates your commitment to buying a home but also provides an estimate of your homebuying budget. During this stage, your lender will take a look at your credit, finances, job status, and more. Be prepared to provide necessary documents such as proof of income, identification, debt-to-income ratio (DTI), pay stubs, W-2 forms, bank statements and your Social Security number.

Step 4: Find Your Potential Home

The next stage involves identifying a home that aligns with your unique preferences and requirements. Keep in mind that the property you choose must meet the VA’s minimum property requirements (MPRs), ensuring its suitability for VA-backed financing.

Step 5: Make an Offer

When you’re ready to make an offer on a home, teaming up with both your VA lender and real estate agent is key. They understand the unique aspects of VA loans and can guide you in crafting an offer that stands out.

While it’s common for negotiations to go back and forth a bit, having these experts by your side can help streamline the process. With proper insights and experience, you’re well-positioned to find a purchase price that’s both fair and favorable.

Step 6: VA Appraisal

The VA appraisal is a mandatory step in the VA loan process. It ensures the home you’re interested in is worth its value and meets the VA’s property standards. Partner with your VA lender to navigate this step smoothly. They’ll guide you, ensuring the property is a solid investment for your future. Remember, it’s all about securing a home that’s safe, sound and sanitary for you and your loved ones.

Step 7: Underwriting

Moving closer to a “clear-to-close” green light, your VA lender will give your loan one final check during the underwriting step. Here, your loan details go into an Automated Underwriting System (AUS). This can result in approval, conditional approval or denial.

Don’t be too discouraged if the AUS doesn’t approve; manual underwriting is another route your lender can take. This means your lender will manually go through your loan application and assess the risk value.

Step 8: Closing

The closing phase is a very exciting step in the VA loan process! You will receive a closing disclosure detailing your loan terms and associated costs, such as the VA funding fee. This is a perfect time to clarify any doubts and ensure everything aligns with your expectations.

You might also have a final walkthrough of the property. It’s a chance to envision your future in your new space and ensure everything’s in order. Once you’ve reviewed and signed the necessary documents, you’ll be handed the keys to your very own home.

Step 9: Move in

Congratulations! You have completed your VA homebuying journey. Remember, the VA requires that you move into your new home within 60 days of closing, and the property must be your primary residence.

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How to Speed Up Your VA Loan Process

Buying a home can be expedited with proper planning and understanding. To streamline your VA loan process, consider the following steps:

  • Start the process early: Begin by securing your Certificate of Eligibility even before you start house hunting.
  • Compare VA-approved lenders: Research and compare VA-approved lenders to select a reputable option.
  • Stay financially prepared: Aside from your loan and down payment, keep a safety net of funds for unexpected needs.
  • Consider hiring a real estate agent: Engage a real estate agent experienced in VA loans, ideally with MRP certification and ties to VA lenders.
  • Have necessary documents handy: Keep necessary documents, such as ID, Social Security number, proof of income, asset statements and debt statements readily available.
  • Make sure your potential home is VA-approved: Ensure your potential home meets the VA’s minimum property requirements. This will hopefully expedite the appraisal process.

Interested in starting the VA loan process?

Understanding the VA loan process allows you to make informed decisions, maximizing the benefits of this significant homebuying advantage. With careful planning and the support of trusted professionals, you’re well-equipped to move toward homeownership. Begin your journey by finding a trusted VA lender.


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