Page 8 - The Panozzo Team - VA Home Loan Guide

WHAT IS THE VA HOME LOAN GUARANTY?

- The VA Home loan guaranty provides a guaranty to the lender should the Veteran
ever default or foreclose on the home. The VA will pay the lender 25% of the loan
amount to offset any losses that the lender may incur due to the foreclosure.

- This is why the VA home loan has no mortgage insurance to secure the loan.

BEGINNING THE VA HOME LOAN PROCESS

1. Apply for your VA home loan Certificate of Eligibility or work with a qualified lender
that can pull it for you.

2. Apply with a VA qualified lender who will help you gather income documents,

review your credit profile, provide bank statements, & help provide you with the
needed guidance for the home buying process.

3. Choose your lender – You can go through a bank, credit union, or mortgage company
to obtain your VA loan.

4. Shop for a home – Look at houses in your price range after you’ve already discussed
your budget and comfortable monthly payment with a lender.

5. Know your lender’s credit score requirements – VA does not have a required

minimum credit score but lenders can differ in what they will and won’t accept.

6. Loan Term – VA loans can be offered in 30-year term or 15-year term. Shorter-term
loans typically have a lower interest rate and lower total cost; however, they also have
higher monthly payments.

7. Fixed or Arm – VA loans can be a fixed-rate or adjustable-rate mortgage (ARM).

• Fixed rate mortgages, which are most common has a set principal and interest
payment throughout the life of the loan, no matter how rates change nationally.
You may see a slight change in your monthly payment each year due to changes

in local property taxes and insurance.

• ARM – This is where your loan interest rate is adjusted periodically, based on an
index. These loans may have a low introductory rate, but the rate can grow over
time and so will your monthly mortgage payment.

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