VA Home Loan Programs
The U.S Department of Veterans Affairs offers a home loan and housing assistance program for its veterans. The basic intention of the VA program is to supply home financing to eligible veterans in areas where private financing is not generally available.
Throughout the history of the program (beginning in 1944 with the original Servicemen’s Readjustment Act), over 20 million VA home loans have been insured by the government. Until 1992, the VA loan guarantee program was available only to veterans who served on active duty during specified periods. However, that same year saw the enactment of the Veterans Home Loan Program Amendments which made eligible Reservists and members of the National Guard who served honorably for at least six years without otherwise qualifying under the previous active duty provisions.
The VA home loan program was designed to offer long-term financing to eligible American veterans or their surviving spouses (provided they do not remarry) and may be used to obtain homes, condominiums, or manufactured homes. This specific program may also be useful in refinancing an existing home loan or making energy-saving improvements and installing energy-efficient appliances. The VA offers three main types of guaranteed home loan benefits including purchase loans, cash-out refinance loans, and interest rate reduction refinance loans.
Below are some of the program’s highlights as well as eligibility criteria:
1. Cash out up to 100% LTV/CLTV
2. FICOs starting at 580 (ARMs 620)
3. Expanded DTI Up to 60%
4. Previous modified mortgages permitted
5. Fixed 10, 15, 20, 25, 30 ARMs 5/1
Streamline Refinance Highlights:
1. FICO 700: Up to 43% DTI; Unlimited LTV/CLTV (No appraisal or AVM)
2. FICO 700: Up to 60% DTI; Max 125% LTV/CLTV
3. FICO 660-699: Up to 50% DTI; Max 100% LTV/CLTV
4. FICO 620-659: Up to 50% DTI; Max 95% LTV/CLTV
5. Payment history:
• FICO 660+ (must reflect 0x30x12)
• FICO 620-659 (must reflect 0x30x24)