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Getting a Florida VA Loan
Florida borrowers must, first and foremost, be eligible for VA home loans. This means they must have satisfied the service requirements and have enough “entitlement” available to be considered for a VA loan. Entitlement is a word used to refer to the amount the VA will guarantee for a particular veteran borrower. “Full” entitlement is usually enough for a VA home loan of $417,000 (or even more in high-cost counties).
#2 — Property Eligibility
The lender's handbook states that VA home loan benefits are to be used for owner-occupied properties. The VA lists single-family homes, VA-approved condos, townhouses and multi-family homes (up to four units per borrower) as properties generally eligible for Florida VA financing. (There may be additional qualifying requirements.)
#3 — Owner Occupancy
Florida VA borrowers must occupy the homes they are applying for financing on. VA borrowers must document that they will occupy their homes within a reasonable time. For most, this typically is within 60 days of closing. Borrowers who are deployed away from home may receive an extension of up to 12 months. A spouse is the only relative that can satisfy the occupancy requirement in a VA-eligible borrower’s place. Florida VA Streamline refinance loans require only that the borrower occupied the home at the time of application.
#4 — Income & Credit
VA-eligible borrowers must qualify for the loans they are trying to obtain. Veterans (and co-borrowers, if joint) must have steady and sufficient income and credit requirements vary. Lenders are given some leeway to gauge whether a borrower is a feasible credit risk within VA guidelines. VA-approved lenders may set their own credit score minimums. The VA recommends borrowers have no more than 41% debt-to-income ratio (DTI) and at least enough income to cover normal living expenses. VA Streamline refinance loans normally do not require income and credit re-qualifying, these are also know as IRRL's.
The Department of Veterans Affairs (VA) helps veterans, eligible surviving spouses, and active duty service members obtain the goal of homeownership through the VA Home Loan Guaranty. The Florida VA loans are provided by private lenders. VA guarantees a portion of the loan, enabling the lender to provide you with more favorable terms. It is important to have all of your military documents ready. The most important of these forms is the DD-214. The DD-214 documents the type of discharge, dates of service and current classification. It is a necessary form if you plan on receiving any type of military benefits.
In order to obtain a VA loan, you will need a VA Certificate of Eligibility. It establishes that you meet the necessary guidelines to take advantage VA loans benefits.
A Florida VA loan is a highly competitive mortgage that does not require a monthly mortgage insurance premium, regardless of down payment or Loan to Value (LTV). A VA loan will allow an eligible borrower to obtain 100% financing, otherwise known as a no-down payment loan. Other qualifications include lower credit score requirements. Most lenders require a minimum credit score of 600 on a VA loan, although, in some cases, credit scores can go down to 550.
Qualification for a VA loan will also require the full underwriting of a borrower’s ability to repay the loan. One of the most important factors is the borrowers Debt to Income ratio, or DTI, as it is commonly referred to as. Debt to Income is defined as the percentage of a consumer's monthly gross income that goes toward paying debts. (Speaking precisely, DTIs often cover more than just debts; they can include principal, taxes, fees, and insurance premiums as well.)
Loan limits on VA loans are determined by the county and State the property is located in, for a full list of loan limits by county, follow the link, http://www.benefits.va.gov/homeloans/purchaseco_loan_limits.asp
While other qualification requirements may apply, depending on the loan program and lender, when the four basic loan approval requirements are met, the applicant(s) will usually be eligible for their Florida VA loan. Loan amounts can vary based on each VA-eligible borrower’s entitlement and ability to pay. If you're interested in a Florida VA loan, please get in contact with one of our accredited lenders.