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Table of Contents
Overview ....................................................................................................................................................... 3
Outline of the VA Homebuying Process ........................................................................................................ 5
Eligibility ........................................................................................................................................................ 6
Before Borrowing .......................................................................................................................................... 9
Beginning the VA Home Loan process .................................................................................................. 9
Some helpful tips: ............................................................................................................................... 10
General Mortgage Costs ..................................................................................................................... 11
Buying a Home with a VA-Guaranteed Loan .............................................................................................. 14
Additional VA Loan Options ........................................................................................................................ 15
Energy Efficient Mortgage (EEM) ........................................................................................................ 15
Alteration and Repair loan .................................................................................................................. 16
Construction Loan ............................................................................................................................... 17
Farm Residence Loan .......................................................................................................................... 19
Loan Assumption ................................................................................................................................. 20
Required Loan Documents .......................................................................................................................... 22
Lender-Required Documents .............................................................................................................. 22
VA-Required Documents ..................................................................................................................... 22
The VA ‘Escape Clause’ ............................................................................................................................... 23
VA Appraisal ................................................................................................................................................ 23
What if my appraisal is below the purchase price? ................................................................................ 24
Home Inspections ....................................................................................................................................... 25
Negotiable items ..................................................................................................................................... 27
At Closing: Buying Your Home .................................................................................................................... 28
Post-Purchase: Mortgage Servicing ............................................................................................................ 29
Escrow Accounts ................................................................................................................................. 29
Appendix A: Military Service Requirements ............................................................................................... 31
Veterans and Active Duty Service members ....................................................................................... 31
National Guard and Reserve members ............................................................................................... 31
Exceptions to minimum service requirements ................................................................................... 32
Other Than Honorable, Bad Conduct, or Dishonorable discharges .................................................... 32
Appendix B: Certificate of Eligibility (COE) .................................................................................................. 33
How to apply for a COE ........................................................................................................................... 33
Proof of Service Requirements ............................................................................................................... 33
Character of Service (COS) Requirements .............................................................................................. 34
Notes on Reserve and National Guard COS requirements ................................................................. 35
Upgrading discharge status ................................................................................................................. 35
Appendix C: Funding Fee Tables ................................................................................................................. 36
Appendix D: Reusing the VA Loan ............................................................................................................... 37
Re-using your VA Loan benefit (Restoring Entitlement) ..................................................................... 37
Buying Another Home (Remaining Entitlement) ................................................................................ 37
Appendix E: Eligible Spouses ....................................................................................................................... 40
How to apply for Dependency and Indemnity Compensation (DIC): ................................................. 41
Surviving Spouses applying for VA Home Loan eligibility: .................................................................. 41
Appendix F: Native American Direct Loan (NADL) Program ....................................................................... 43
NADL Eligibility .................................................................................................................................... 43
Appendix G: How to Avoid Foreclosure ...................................................................................................... 45