VA Loan in Chicago, IL
A VA loan offers a unique home financing option that’s government-backed, primarily tailored for Veterans, those in active service, and their surviving spouses. These loans don’t stem directly from the Department of Veterans Affairs but are provided by individual financial establishments like banks and mortgage houses.
Such loans, backed by VA, feature enticing interest rates and terms, apt for purchasing single-family homes, condominiums, multi-unit properties, manufactured houses, or new constructions.
How does a VA loan work?
While VA loans bear similarities to standard home loans, they have distinct perks. A significant number of VA loan seekers don’t have to worry about a down payment, although making one could be beneficial. Lowering the loan amount through a down payment might reduce the VA funding fee, overall interest, and can lead to faster equity gains.
Many traditional loans require borrowers to have mortgage insurance as a protection against defaults. However, VA loans are exceptional in not demanding such insurance.
Also, VA loan providers can only impose a maximum 1% fee of the loan’s total amount for closing costs, making them more budget-friendly than several other loans. Neither FHA nor regular loans have such restrictions on origination or associated lender fees.
What Types Of VA Loans Are There?
Different VA loan options are available, each with its unique advantages and constraints. To identify the one that matches your requirements, it’s essential to examine their features and contrast them.
Here’s a quick rundown of some VA loan selections available in Chicagoland:
Standard VA Mortgage
Often called a standard VA or VA jumbo mortgage, this is the most common type. It primarily allows prospective homeowners to acquire properties without a mandatory down payment. The terms of a standard VA loan are typically more appealing than a regular private mortgage. Note that the specifics can vary among lenders.
Both adjustable and fixed interest rates can be chosen for this type of mortgage.
VA Home Improvement Loan
This loan caters to those who wish to purchase and then renovate a house or just sponsor home renovations. It aligns closely with the standard VA loan but emphasizes home improvements. However, only select lenders offer this specific option.
VA Loan Eligibility
For securing a VA loan, present a Certificate of Eligibility (COE) to your lender. This certificate, acquired by demonstrating proof of your military service and related paperwork, can be applied for online via the VA’s official portal or through a downloadable form. While the eBenefits platform offers instant COE verification, the mail method may require 4 to 6 weeks.
Service duration and the nature of service define VA loan eligibility for veterans and current military staff. Some widowed spouses could also be eligible.
Potential candidates include active service members, veterans, National Guard, and Reservists, with some other specific categories. In general, VA loan qualification rests on:
- You have completed at least 90 days of active duty service.
- You have at least six years of service in the Reserves or National Guard .
- You have served at least 181 days of active duty service during peacetime.
- You have 90 days of cumulative service under Title 10 or Title 32. For Title 32 service, at least 30 of those days must have been consecutive.
- You’re the spouse of a military service member who died in the line of duty, or as a result of a service-related disability.
Your Trusted Chicagoland Mortgage Lender
Established in 1909, Mutual of Omaha has been a beacon of trust for its clients. Rooted in community ethos, our mission revolves around genuine service, commitment, and fostering financial health. Building lasting relationships is our essence. More than just observing market trends, we’re devoted to helping our clientele achieve their financial dreams. For those considering homeownership or refinancing, our VA Home Loans streamline the journey. Mutual of Omaha Mortgage stands by you. For us, loans are more than mere deals; they symbolize dreams, goals, and treasured life events. Recognizing your unique aspirations remains our foremost concern.