VA Loans
If you are a veteran considering buying a home, you may be interested in gaining pre-approval for a VA loan. This is an excellent option available to you, but you may be wondering how to go about the application process. There are five simple steps to gaining pre-approval that are similar to all mortgage loans.

1. Fill Out an Application
There is no need to complete every box on the application, however. The Loan Officer can help fill in the blanks for any answer you are not sure about if that is needed.

2. Fill in Form 26-1880
This is equivalent to the Certificate of Eligibility for a VA mortgage loan, so if you already have this document there is no need to complete this form. If you do not have the Certificate of Eligibility, however, obtaining and completing one is simple and available on both homeloans.va.gov or military.com. A simple search for the “Form 26-1880” should do the trick.

3. Locate Income Verification Documents
You will need to submit documents that prove your personal yearly level of income as a means for the lending agency to assess your ability to pay your loan. Such forms include recent W2 forms or current pay stubs/LES. Also, since this is a VA loan, your Disability or Retirement statement from the VA will be necessary.

4. Allow for Credit Review
After obtaining your permission, the Loan Officer will need to run a credit report in order to review your financial history. For the purposes of a VA loan, an average credit score of 620+ will be acceptable. However, like obtaining ANY mortgage loans, bad spots on your credit such as liens, bankruptcies, repossessions, or foreclosures will impede your ability to get a loan. A low overall credit score (below the aforementioned 620) will also not allow you to obtain pre-approval.

If, by chance, you cannot get the pre-approval for your VA mortgage now, the Loan Officer that you are working with should be able to explain why and help you formulate a plan to be able to improve your credit and obtain a loan in the future.

5. Wait for an Analysis of the Total Amount
Once you are assured pre-approval by the factors outlined above the final step is to see how much the loan amount will be. Once that is determined you will receive a pre-approval letter from your Loan Officer as well as additional disclosures. You will be required to sign the latter documents, however, they are not binding. This means you will not be locked into any amount or payback routine. The signing of binding documents will only occur at the closing.
All told, the process for pre-approval should take only 1-2 hours and there are ways to complete it via telephone, email and fax. Also, be aware that there should never be a cost associated with the pre-approval process. Lenders are legally allowed to charge for some services covered in this process, but majority of Loan Officers will not, so make sure yours is one of those.

Once you obtain your pre-approval, it will be valid for 90-120 days. By taking the time to obtain the pre-approval letter, you let sellers know you are serious in your intent to buy a new home and they are more willing to deal with you.
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