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Pre-Approved VA Home Loans: A Brief Guide To Applying For One

Finding an affordable option amongst the wide range of mortgages can be tough these days, especially when the applicant has a low credit rating or a limited income. But there are options out there, and pre-approved VA home loans offer qualifying applicants one of the most cost-effective mortgage options around.

The VA has long been a source of financial help for former members of the military, and their support when it comes to mortgages means some real savings can be enjoyed. But for the home hunter, securing pre-approved mortgagesoffers other advantages too. Not least is greater negotiating leverage and the ability to commit to a purchase on the spot.

But how can someone secure a pre-approved VA home loan? And is the process complicated? Here, we provide a step-by-step guide so nothing is missed when it comes to the real thing.

1. Complete The Necessary Forms

The obvious forms to start with when seeking a pre-approved VA home loan is the loan application form. This will request the usual personal and financial details, but if there are any queries, simply leave the area blank and seek advice from the VA loan officer. It is important that all information is accurate and relevant.

A second necessary form is the 26-1880, which confirms eligibility for a VA home loan. This is a simple form that should take no time at all to fill in. However, it is important if there is to be any chance of securing pre-approved mortgages. This form is not needed when an applicant already has a Certificate of Eligibility.

2. Provide Additional Documentation

As well as the forms above, it will also be necessary to produce some additional documentation relating to your income. These include your W-2 form, and perhaps a pay stub. These will provide clear confirmation of your current income, which is obviously essential when applying for a pre-approved VA home loan.

Other documentation that may be requested can confirm other payments, for example any disability payments or retirement payments from the military. These items care covered in a VA Award Letter and Retirement Statement respectively.

3. Credit History Check

It is unavoidable that the loan officer will want to see your credit history – it is a key condition to securing pre-approved mortgages anyway. The check will take a look at your credit report, where details on past loans and repayment patterns can be seen. If there are any defaults, bankruptcies or even repossessions in your history, then they will be found.

Credit scores of around 620 are considered high enough to make VA home loan approval likely, but anything lower than that is likely to prevent any pre-approval. If the application is rejected, then the loan officer is obliged to explain why.

4. Loan Analysis

The last step in our guide refers to the lender checking the details of the proposed mortgage more closely. Getting pre-approved VA home loansis a nice idea, but it still comes down to whether the mortgage is affordable or not.
The lender will examine the information provided, especially income and any existing debts and determine if the loan is affordable or not. If it is then finally securing pre-approved mortgage funds becomes just a formality.

With approval, the lender will send out a Pre-Approval Letter confirming the sum available, which can be handed to property sellers to confirm the funds are available. There will also be some disclosures which need to be signed and sent back immediately, but they are non-binding.

And remember, pre-approved VA home loans are generally valid for 90 to 120 days, which is plenty of time to find your new home.

Bad Credit Home Loans – Grab The Easiest Loan Scheme

There is no scarcity of home loans providers in the market for good credit holders. But the same affair becomes challenging when you have a bad credit. In this state, offering loans becomes a risky sign because borrowers might not be able to reimburse the loan, as lenders fear. Thus, with the intension to provide relief to these specific categories, bad credit home loans are designed. The strategies and policies of this loan scheme are implemented only for the sake of providing financial strut to those with less than perfect credit.

Finding lenders for bad credit home loans is not something hard to come by. Banks, financial institutions and money lending sources now support bad creditors under this scheme. So, now searching for loans related to house is no more regarded as a tedious task. In this loan, you can expect huge amount as benediction. The lump sum loan amount is the biggest advantage you can get and it depends upon the value of the collateral. Thus, it is a loan against your property. Moreover, to serve the use of collateral you should use property which has market value. Land, estate, commercial and residential properties, house, car and same in order can be pledged as collateral. Another advantage is that despite using their home as collateral, applicants need not have to move. Borrowers or customers still retain their ownership on their property by making regular monthly instalments. Bad credit home loans follow prolonged reimbursement terms and graces from 10-25 years from the approval date.

The interest rates of bad credit home loans will leave you in a surprised state because it is low and cheap for all. Moreover, the interest rates vary from one lender to another due to the prevailing fierce competition among lenders. To collect more information concerning to interest rates. Get the quotes of different lenders and compare them minutely. This act is rewarding for availing reasonable rate and suitable for a good budget. A loan calculator is another device which you can make use of to extract the monthly instalments that you will have to pay. In the loan calculator, insert the loan amount, interest rates, and repayment term; and you will derive answers for the amount that you will pay as monthly instalments. This service and the quotes it provides can be found online without any cost.

Bad credit home loans can assist you in meeting miscellaneous ends. Purchasing plots, property for a house, decorations for your house, improvement of home and the extension of rooms are some ends which can easily be catered. Beyond those primary ends, this loan also gives the provision to consolidate debts and solve the financial discord and reduce it to zero. Improving the credit condition is also another measure that you can proceed with. Moreover, you also get an opportunity to establish a reliable relationship with banks by making regular monthly installments.

For quick results and a fast approval process, go for the online application method. The online application procedure is an easy going method and free from all the hassles of paperwork. You can apply and access information from anywhere through this method.

Now, even if you have poor credit, you can build a house or embellish it in the way they like just by applying for bad credit home loans.

Home Loan Modification – Myths About Obama’s Making Home Affordable Act

The home loan modification act is what everyone seems to be talking about. In the current economic downturn, homeowners are unable to meet their required monthly payments, bills, taxes etc. This new program, which has been introduced under the Homeowners Act, is a process that entails refinancing the conditions of the original loan and adjusting it accordingly so that it becomes more affordable for the borrower. There are many misconceptions and myths about home loan modifications, however.

Lenders must comply with some serious guidelines under this new program introduced by the President. There are approximately seventy five billion dollars under the Homeowner Stability Initiative which have been set aside to be used for loan modifications during the period between 4 March 2009 and 31 December 2012. Lenders under this program will assist in making adjustments to the loan for the homeowner in return for an incentive paid by the government. This means there will be fewer foreclosures. This method will help nearly 4-5 million homeowners to become more stable financially and to keep their homes.

One misconception about the MHA is that people think that lenders are being forced to enter this program. This is untrue, since lenders are paid an incentive to participate and assist in loan modification.

The lender will make a decision if the homeowner needs to foreclose or to participate in the program, whichever option is most profitable to the bank. Foreclosure tends to be lengthy and expensive. Lenders prefer to modify the loan rather than to foreclose since it is more profitable to them. Another myth resulting in the MHA is that house flippers and speculators will take advantage of the help provided under the Homeowner Stability initiative plan. This is also not true. In order to participate in the loan modification program, the homeowner must be living in the house the mortgage is required for. Vacant homes, second homes, investment properties and condemned homes will not be considered under this initiative.

During a time when the economy is unstable and financial difficulties are on the rise, people  tend to be wary of participating in new programs. In order to learn more about MHA, do some research online and read the guidelines on it. Once people have fully learnt about the MHA plan it will become a natural thing and the myths and misconceptions will cease to exist.

Be cautious of false information floating around. A homeowner’s first priority must be to keep their house and not have to file for bankruptcy. Learn as much as possible about home loan modification, apply for this program and lower the mortgage to  avoid foreclosure.