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Papillion NE VA Loans

Papillion NE VA loans, who does them

If you qualify, a Papillion NE VA loan is one of the best options for home financing. Because it is guaranteed by the Department of Veteran Affairs, the VA loan offers benefits not found in other loans. The VA guarantee allows lenders to offer low rates with no down payment.

Who qualifies for a VA loan?

The VA loan is a benefit to active duty and veterans who meet certain requirements. The requirements can be found at the VA website, but a lender should can pull your Certificate of Eligibility. If you were active duty for 90 days or in the Reserves or National Guard for six years, you should qualify. Just to make sure, the first step is to request your Cert of Eligibility.

What are the advantages of a Papillion NE VA loan?

No down payment

The VA loan does not require a down payment. An eligible buyer can get financing for 100% of the purchase price

Low rates

Even with no down payment, VA is able to offer some of the lowest rates of any loan program. They are typically .25% to .5% lower than Conventional rates

No mortgage insurance

VA is the one program that has no monthly mortgage insurance with less than 20% down. Considering mortgage insurance can sometimes by several hundred dollars a month, this can be a big savings for eligible buyers.

VA allows high debt ratios

VA will allow higher income to debt ratios than FHA or Conventional. Depending on other factors, debt ratios can go above 60% of your monthly gross income. This higher debt ratio limit will give buyers more flexibility when structuring the home financing.

VA allows 4% seller concessions

The seller can give the buyer 4% of the purchase price in concessions. These can be used to cover closing cost and escrow. Combine these with the no down payment option and it is possible to purchase a home with no money out of pocket.

VA loans are transferable

If a VA homeowner can transfer their loan to another VA eligible buyer. In a rising rate environment a VA buyer could take over an existing VA loan with a lower rate.

VA loans are more forgiving on credit score and history

VA has no minimum credit score. However, most lenders require a 620 score to qualify. VA only requires that buyers are 2 years discharged from a Chapter 7 bankruptcy. On a Chapter 13 bankruptcy just verifying 12 months of on time BK payments, and permission from the court, will allow you to qualify.

What are the disadvantages of a Papillion NE VA loan?

VA has a funding fee

Though the VA loan does not have mortgage insurance, it usually has a funding fee.* Currently this is 2.15% of the loan amount for the first use of the VA program. It is 3.3% for subsequent uses. If you are buying a $200,000 home, and using the VA loan for the second time, your loan amount will be $206,600.

*You may be exempt from the funding fee. Your Certificate of Eligibility will let us know if you do not have to pay that VA funding fee.

Only the veteran and spouse can be on the loan

The VA loan only allows a spouse to co-sign with the VA eligible buyer. This has actually created a few strange situations for me as a lender. I have had buyers get married during the loan process so they could both go on the loan and qualify.

The VA loan is only for primary homes

You cannot use the VA loan to purchase investment property or second homes. However, you can move out of your VA primary home and convert it to an investment or second home. Depending on how much eligibility remains, you may also qualify for a second VA loan.

If you think you qualify for Papillion NE VA loan, contact us and we will pull your Cert of Eligibility. If you do qualify we can help walk you through all aspects of the VA program.

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