10 Documents Needed for a VA Loan (for Fast Approval!)

documents needed for a va loan

Getting approved for a loan is a stressful process. It often feels like the bank is digging into your personal life. Which they are, but for good reasons.

But the good reasons don’t assuage the need for more documents than you ever need for any other life situation. And while the VA loan process is less stringent than your typical loan process, it still requires a stack of papers.

If you can have your stack of papers ready before you even apply, the process will go that much faster. That’s why we’ve put together a comprehensive list of the documents needed for a VA loan.

Scroll onward to read the list.

The Always Necessary Documents Needed for a VA Loan

While your record of service is probably stored in a filing system somewhere, your bank won’t have access to it. You need to prove you’re a U.S. Veteran with documentation.

Certificate of Eligibility

This certificate is the formal document declaring your loan entitlement. Most lenders can actually obtain this for you. But some won’t.

You can find the certificate of eligibility at the va.gov website.

Proof of Income

The bank needs to know you’re getting paid. If you’re not getting paid, you can’t pay your mortgage.

Find two-three months worth of paystubs. If you are self-employed, you may need more proof of income than two months as your income might not be the same month to month.

Estimated Monthly Debt

Your debt-to-income ratio is exactly how it sounds. It’s all your credit card and other loan debt you have to pay each month compared to your income each month.

If you have multiple credit cards, be sure to track down each one and find out how much you owe each month. And you will need to provide other debt information such as student loans, car payments, and child support.

Credit Report

Most people just authorize the bank to run a credit report. But if you’ve had multiple credit checks, you might want to take advantage of your free credit checks assigned to each person each year.

This will also show your current debt to the lender.

Recent Bank Statements

With online banking, you no longer need to go to the bank in person to get your bank statements. But be sure you print your statements and not the summary shown on your online banking first page.

It’s good to have the last six months of your bank statements in hand when applying for a loan.

W-2 Statements

Most lenders want to see your annual income as well. They do this because they want to know your income is steady.

W-2 statement will also clue a lender into whether you retain jobs. If they didn’t ask for W-2 statements, they would have to rely on your word or have to call around for employment references.

Not Always Necessary Documents Needed for a VA Loan

Only one document may not be necessary for a VA loan application. And that’s your bankruptcy history.

If you’ve never filed for bankruptcy, then this document isn’t necessary.

If you need a mortgage today gather your documents needed for a VA loan and apply now for our VA mortgage program.

5 Things That Can Affect Your Housing Loan

housing loanEvery year, the number of new homeowners dwindles.

There are several reasons why. It could be due to outlying student debt or diminished general appeal. Or maybe it’s simply the daunting task of trying to get a housing loan.

Becoming eligible for a loan can seem difficult, but no home seeker should let that stop them. We’re here to help you learn the things that can affect the approval of your loan.

Let’s get into it.

Credit Score

Banks and other lenders will take a look at your credit score to know whether giving you a loan will be a risky investment on their part or not. The amount of income you make doesn’t have much of a say on this. You could make a lot of money and still have a bad credit score.

Your credit score can have an effect on how much of a loan you can get, as well as the interest rate.

Take some time to find out your own credit score before approaching any lenders. Be certain to check your credit report for errors or flaws. You don’t want any wrong information to affect your rates or chance to secure a loan.

Being Self-Employed Can Deny You a Housing Loan

Regardless of how much you make in a year through your self-employment endeavors, the fact remains that it can look poorly to banks and other lenders. Self-employment can look far too variable in their eyes and can make you seem like a risky investment.

Unfortunately, there isn’t much you can do about this, but it is good to know about so that there aren’t any surprises coming your way.

A good thing would be to bring any pay stubs with you when meeting with your potential lenders. This could help you get a quicker approval.

Never Had a Loan

Strange as it may sound, sometimes being loan-free can be a bad thing. Because you’ve never taken a loan before, banks and other lenders can’t easily decide if you are a trustworthy client or not.

Are you the type of person to pay on time? They have no way of knowing and it’s likely they aren’t willing to take that risk.

One way around this predicament is to take out a small personal loan or credit card a year or two before. If you make the payments on time or are able to pay the loan back, you will build up your credit score and show banks that you can be trusted.

Debt to Income Ratio

A lot of the time, people will try to get a loan for far more than they can actually afford. This will, in turn, plummet their credit score and end up being more trouble than it needs to be.

Knowing your Debt to Income Ratio is a good way to figure out how to make a loan’s payment reliably with your monthly income, all while factoring in all of your other due payments as well.

Take a moment to look at your numbers before deciding how much to ask for your housing loan.

Being Dishonest

It could be tempting to try and hide a particular debt in order to get a housing loan, or maybe make a bad set of debt seem a little better. But honesty is definitely the best policy when it comes to dealing with banks and lenders.

Being dishonest in any of this will risk you being charged with fraud, and it will make it much more difficult to ever find a bank or lender that will want to work with you in the future.

Conclusion

We hope that this has helped you understand more about the process and that you’ll find it easier to expect what will affect your loan. We wish you all the luck in the world for the future.

The feeling of owning that perfect house is way too precious. And we want to help you!

If you have any questions or concerns, please feel free to contact us!

Your First Home: Should You Get a New House?

new house

When you make the decision to buy that first new house, it’s a big deal. Like, “keep you up at night thinking about it” big deal.

If you’ve been paying rent for a while, buying a new home could seem like the cheaper choice. And there are plenty of benefits for first time home buyers.

Here’s one big piece of advice though.

When buying a new house, know what to expect.

Of course, you can never fully know what to expect. With buying a house, there are always going to be unforeseen obstacles.

But there are expected payments and fees that you can be sure will be part of the process. So it’s best to get familiar with them before you take the plunge.

Down Payments

You want a good interest rate. But in order to get that rate, you’ll need to make a down payment on the house. You can expect at least 10%. So, for instance, on a $170,000 home, this will be $17,000.

And if you want to avoid private mortgage insurance (insurance that protects the bank in case you’re unable to pay your loan), it will need to be at least 20%. So now that $170,000 house will need a $34,000 down payment.

Homeowner’s Insurance

Maybe you had renter’s insurance, so this isn’t entirely new to you. But homeowner’s insurance is usually going to run you considerably more than renter’s insurance.

And it’s required before you take possession of your home. So once you’ve gotten mortgage approval and done all the footwork to get your new house, you’ll need to shop around insurance companies to find the best rate.

The good news is, you can lump your car insurance with your homeowner’s insurance and possibly get a discounted rate.

Property Taxes

This one often catches new homeowners by surprise.

If you’re folding your property taxes into your mortgage payment, that’s going to be an extra bundle of money you’ll need to pay each month.

For example, if you’ve been paying $1000 per month in rent and the mortgage payment on your new house will be around that amount, you might think you’re good to go.

But, if your yearly property taxes are $2400, then you’re looking at adding another $200 per month. So when you budget for your monthly payments, don’t forget to figure in your property taxes divided over 12 months.

Payments and Interest

Obviously, you have to pay your mortgage principal.

At the beginning though, much of your mortgage payments will be going toward paying just the interest. So you want to be sure you’re getting the best interest rate possible.

In the long run, a great fixed rate could end up saving you thousands of dollars.

And that’s just the beginning

On top of the above-listed considerations, there are other things like the fees tied up with escrow, tax services, as well as getting credit reports and a home inspection.

Still, there’s nothing quite too exciting as getting that new house for the first time. It doesn’t have to be scary. If you approach the experience armed with some knowledge, you’ll end up with a place you can truly call home.

Do you have any other helpful tips for those looking to buy a new home? We’d love your input!