Are you a military veteran or currently serving in the military and looking to buy a home in Oregon? Then you might want to consider getting a VA home loan. This loan program is designed to help veterans and active-duty military members buy homes with more favorable terms than traditional mortgages. In this article, we’ll discuss everything you need to know about Oregon VA home loans, from eligibility requirements to the application process.
What is a VA Home Loan?
A VA home loan is a mortgage loan that’s guaranteed by the U.S. Department of Veterans Affairs. This loan program was created in 1944 to help military service members, veterans, and eligible surviving spouses become homeowners. VA home loans have several advantages over traditional mortgages, such as lower interest rates, no down payment requirement, and no private mortgage insurance (PMI) requirement.
Who is Eligible for a VA Home Loan?
To be eligible for a VA home loan in Oregon, you must meet one of the following criteria:
- Have served at least 90 consecutive days on active duty during wartime
- Have served at least 181 days on active duty during peacetime
- Have more than 6 years of service in the National Guard or Reserves
- Be the spouse of a service member who died in the line of duty or as a result of a service-related disability
You must also have a certificate of eligibility (COE) from the VA to apply for a VA home loan. You can obtain this certificate by submitting a request online, through a VA-approved lender, or by mail using VA Form 26-1880.
What Types of Properties Can You Buy with a VA Home Loan?
You can use a VA home loan to buy various types of properties, including:
- A single-family home
- A multi-unit property (up to 4 units)
- A condominium unit
- A manufactured home or lot
However, the property must be your primary residence, and it must meet certain minimum property requirements (MPRs) set by the VA. These requirements include things like a safe and sanitary living environment, adequate heating and cooling systems, and a minimum amount of living space.
How Much Can You Borrow with a VA Home Loan?
The amount you can borrow with a VA home loan depends on several factors, including your credit score, income, and the cost of the property. The VA doesn’t set a maximum loan amount, but it does limit the amount of its guarantee, which is 25% of the loan amount up to the current VA loan limit for your county.
In Oregon, the current VA loan limit for a single-family home is $548,250 in most counties. However, some high-cost counties, such as Clackamas and Multnomah, have higher loan limits. You can check the current VA loan limits for your county on the VA website.
What Are the Benefits of a VA Home Loan?
VA home loans offer several benefits over traditional mortgages, including:
- No down payment requirement: You can buy a home with no money down.
- No private mortgage insurance (PMI) requirement: You don’t have to pay for PMI, which can save you thousands of dollars over the life of the loan.
- Lower interest rates: VA home loans usually have lower interest rates than conventional mortgages, which can save you money on monthly payments and over the life of the loan.
- Flexible credit requirements: VA home loans have more lenient credit requirements than traditional mortgages, making them easier to qualify for.
- Assumable: VA home loans are assumable, which means that if you sell the home, the new buyer can assume your loan and take advantage of its favorable terms.
What Are the Drawbacks of a VA Home Loan?
While VA home loans have many benefits, they also have some drawbacks, such as:
- Funding fee: VA home loans require a funding fee, which is a one-time fee that’s typically 2.3% of the loan amount. However, this fee can be waived if you have a service-related disability.
- Property requirements: VA home loans have strict property requirements that must be met for the loan to be approved.
- Loan limits: VA home loans have limits on the amount you can borrow, which may not be enough to buy a high-priced home in some areas.
- Appraisal process: VA home loans require an appraisal process that can be more rigorous than traditional mortgages, which can delay the loan approval process.
How to Apply for an Oregon VA Home Loan
To apply for an Oregon VA home loan, you’ll need to follow these steps:
- Get your certificate of eligibility (COE) from the VA.
- Find a VA-approved lender in Oregon.
- Pre-qualify for a VA home loan by providing your income, credit score, and other financial information.
- Find a home that meets the VA’s minimum property requirements (MPRs).
- Make an offer on the home and sign a purchase agreement.
- Complete the loan application process with your lender, including providing documentation such as income statements, tax returns, and bank statements.
- Have the home appraised by a VA-approved appraiser.
- Close the loan and move into your new home!
Conclusion
If you’re a military veteran or active-duty service member looking to buy a home in Oregon, a VA home loan might be the right choice for you. With its favorable terms and benefits, a VA home loan can help you become a homeowner with less money down and lower monthly payments than a traditional mortgage. To learn more about Oregon VA home loans and to get started on your homebuying journey, contact a VA-approved lender today!