Update For Sbp School Certification
The certification process has gotten easier for students age 18 and older covered as a child annuitant under the military Survivor Benefit Plan.
The changes went into effect in May 2020, highlighted by the following:
- A simpler certification form
- A students ability to self-certify
- An extension of the certification deadline to annually instead of each term/semester
SBP annuity payments for qualifying high school and college students are not affected by school closures in the wake of coronavirus disease 2019.
The DOD simplified the process of students becoming certified in other ways, including:
- Students will now self-certify. So they will no longer need a school officials signature or school documentation when they certify full-time attendance. With COVID-19 school closures, this truly simplifies the process.
- Simpler Child Annuitants Certification for Previous Attendance Letter for certifying past attendance.
Applying For A Va Loan Is Not Solely Dependent On The Vet
Little known fact: the process of applying for this government-backed mortgage program is not limited to just the person whos affiliated with the military. With married couples, the spouse can also do a lot of the legwork. In fact, many military spouses handle the entire transaction for their partner and family. This is especially helpful for service members and their families who dont want the fact that theyre away on active duty to slow down their search for the home of their dreams.
Other scenarios exist as well. Military spouses:
- may be co-borrowers, providing income that helps the family qualify for a larger loan amount
- may also be eligible as military service members or vets and have their own entitlement that increases the loan benefits
- may have VA loan eligibility in the wake of a loved ones passing
Can Existing Va Borrowers Lower Their Interest Rates By Refinancing A Va Loan
On top of that, its also possible to reduce your interest rate by refinancing a VA loan through the interest rate reduction refinance loan . This loan requires you to use additional VA financing to replace your current loan and comes with an upfront VA funding fee of 0.50% of the loan amount.
In the end, the VA loan program can be a big help to those who have sacrificed their country and want to achieve the dream of homeownership.
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Are Va Loans Assumable
VA loan is an assumable mortgage, which is one of its many benefits. Mortgage assumption is the process of having another person take over the mortgage and interest in the property instead of selling it on the real estate market. But just like any other loan, it comes with pros and cons.
How to assume a mortgage? The person who assumes the loan takes over the loan balance, interest rate, as well as monthly mortgage payment. VA loans that were closed after March 1, 1988, must be approved by the current lending company for the assumption. Only select VA lenders allow mortgage assumptions, so be sure to check with the lending company first.
Assuming VA loans is an attractive option for real estate buyers for many reasons. With the VA home loan assumption, you dont need to be an active service member, military veteran, or surviving spouse to be eligible. Not only that, youre getting the mortgages existing interest rate. Its a straightforward benefit if the mortgage for assumption has a lower rate than new loans. You will also pay a lower VA funding fee and closing costs.
Va Benefits For Spouse And Children
There are a number of VA benefits for spouse and children of every veteran. In fact, as the dependent of a veteran, you may qualify for benefits such as health care, life insurance, money for school, or vocational training. If you are the survivor of a service member or veteran, you may also qualify for the additional benefits of burial costs and even compensation.
In this article, we will break down for you what benefits are available for your dependents and how to find out if they qualify. Then we will answer some of the most asked questions about VA benefits and dependents.
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Exemption From Funding Fees
Disabled veterans are exempted from the VA funding fee, so they dont have to pay the VA funding fee during closing. To qualify for the exemption, you must currently receive some form of disability benefits. Your level of disability is irrelevant.
This exemption can save veterans or their surviving spouse thousands of dollars. For example, if you buy a home worth $200,000, you might pay as much as $2,800 $7,200 in VA funding fees when you close. Disabled veterans can avoid this fee.
How Can I Get A Free Military Headstone
Private Cemetery To receive a headstone, marker, or medallion, the eligible applicant must submit a VA Form 40-1330, Claim for Standard Government Headstone or Marker or VA Form 40-1330M, Claim for Government Medallion to the VA along with proof of military service, to request a Government-provided headstone or marker.
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Can A Va Refinance Loan Be Issued To Buy Out A Divorced Spouse
The eligible veteran may apply for a VA refinance loan to buy out the spouses share of the home in cases where the couple applied for the VA mortgage together once legally married. Lender standards, state law, and other factors may apply. You will need to speak to a participating VA loan officer to determine what is possible depending on circumstances, state law, and the terms of your loan agreement.
Your lender may require you to furnish documentation showing the loan is sustainable with only one borrower if there was more than one borrower on the original mortgage.
What Are The Surviving Spouse Va Home Loan Requirements
To qualify for a VA loan, you must remain unmarried after the death of your spouse. Additionally, one or more of the following conditions must be met:
- Your spouse died in the line of service or from a service-related disability/injury/condition
- Your spouse was MIA or a POW for at least 90 days
- Your spouse had a service-related disability and was eligible for disability compensation at the time of death.
If the above conditions are met, and you are eligible for the loan, you will need to complete the following:
- Apply for the VA Certificate of Eligibility . You can apply online, through the mail, or through your VA-approved private lender.
- Satisfy the lenders requirements, including a minimum credit score of 620, a debt-to-income ratio of less than 40%, and a fair credit record.
- Pass the MPRs defined by the VA.
See how much your mortgage payment will be with our VA Loan Calculator!
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Assistance From The Social Security Administration
- Monthly Social Security payments are paid to a spouse or a divorced spouse with children of the deceased service member under the age of 16, or disabled children in their care who meet the eligibility requirements.
- Monthly payments are also paid to children under the age of 18, or 19 if they are full-time students, or older children who were disabled before the age of 18.
- The amount paid will be determined by the Social Security Administration.
- Up to $255 in Social Security benefits may be paid to the surviving spouse living with the member at the time of death.
- If there is no surviving spouse, the sum is paid to the child or children who are eligible for Social Security benefits for the month of death.
- If more than one child is eligible for the month of death, the sum is divided equally among all such children. No other survivors are entitled to this benefit.
Do I Qualify For A Va Home Loan
The Department of Veterans Affairs tries its best to make this program available to military home buyers at all financial levels.
So even if you dont have an eligible VA loan co-signer, its worth checking with a lender to see whether you qualify.
Apply For A Va Home Loan Today
VA loans are often the most affordable option for active military members, veterans, and surviving spouses to purchase a home. If you decide to take out a VA loan, be sure to specify beneficiaries in your will so your spouse can assume the loan more easily. Its also wise to have life insurance to prevent your loved ones from being burdened with debt after youre gone.
Do you have more questions about qualifying for a VA-backed home loan as a veteran or surviving spouse? Are you ready to get pre-approved for a VA loan? Either way, feel free to contact Financial Concepts Mortgage at 722-5626 for more information, or begin your application online today. We proudly serve military families in Oklahoma, Texas, Kansas, Arkansas, and Alabama by offering some of the lowest rates in the country.
Secure A Certificate Of Eligibility
Youll need this to be eligible for your VA loan. Youll need to provide proof of your military service based on your status.
VA-approved lenders, like Rocket Mortgage, can help you get your VA certificate of eligibility quickly with proof of service.
Tell your lender you need your certificate of eligibility early in the process so they can help you get it.
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Va Benefits For Surviving Spouses
Spouses who have lost their partners in the line of duty are entitled to specific benefits to help them after their Veteran or service member spouse has died. These VA surviving spouse benefits include:
- Survivors Pension: You may be eligible for a VA Survivors Pension if your spouse served at least one day of active duty during a wartime period and you meet specific income and net worth limits set by Congress. You will have to qualify and apply to receive these death pension benefits.
- VA Home Loan Programs: You can apply to receive a certificate of eligibility that will allow you to build, buy, repair, or refinance a home. The VA also provides financial counseling for surviving spouses who struggle with mortgage payments and the risk of foreclosure.
- Compensation for Surviving Spouse and Dependents : This program provides a tax-free monetary benefit to family members of service members who died of a service-related injury or illness.
- Burial Benefits and Memorial Items: The VA can give you step-by-step guidance on planning a burial in a VA national cemetery or another Veterans cemetery. You can also apply for financial assistance for burial costs, access grief counseling and transition support, and request memorial items for the funeral or memorial service.
Va Loan Rules Arent The Only Regulations For Va Home Loans
Eligible VA borrowers who live in community property states will find that state law dictates how VA loans may proceed. Community property laws could be viewed as a states rights and factor in that each state has its own way of doing things and community property laws dictate who has the obligation of debts incurred in a legal marriage.
You may find that community property laws require the spouses participation in the initial loan process, but the degree of obligation beyond that point will depend on state law. In short, youll need to know the laws of your state before applying for a VA mortgage with a spouse.
This is also true of getting a divorce while you are still paying on a VA mortgage. State law will dictate how that financial obligation is to be treated in the divorce if the couple does not reach an arrangement on their own.
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Undergo Va Appraisal And Underwriting
Underwriters from your lender assess your finances and make sure you qualify for a VA loan. The VA will also require an appraisal before they approve the loan. VA appraisals are stricter than conventional loans. During a VA appraisal, the appraiser will check that the home meets the VAs MPRs and is sanitary, structurally sound and move-in ready with minimal repairs.
Selected Reserves Or National Guard
You must have completed 90 days of Title 10 or Title 32 active service. For Title 32 service to count, at least 30 of active service must have been consecutive.
Or you need to have completed a total of 6 years in the Selected Reserves or National Guard and:
- Were discharged with an honorable discharge, or
- Were placed on the retired list, or
- Were transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable service, or
- Continue to serve in the Selected Reserves
If you’ve completed less than 6 years of service, you may be eligible if discharged for a service-connected disability.
You may also be determined eligible if you:
- Are an unremarried spouse of a veteran who died while in service or from a service connected disability, or
- Are a spouse of a service member missing in action or a prisoner of war
Note: If you are a surviving spouse, you may also be eligible for VA loan benefits. Read the article VA Loan Eligibility Expands for Surviving Spouses for more details.
Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with WW II service, and others may also be eligible.
Related VA Loan Eligibility Articles:
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Can You Have A Co
If a mortgage lender tells you that you need a co-signer for a VA loan application, it means they will not provide financing based solely on your own income and credit history.
The lender may want another person on the loan who will promise to repay the mortgage loan if you cannot.
Thats where a co-signer comes in handy. This person can help you qualify for the mortgage if your personal finances dont quite meet a lenders requirements.
Who can co-sign a VA loan?
Fortunately, you are permitted to have a co-signer on a VA home loan. But this person must occupy the home with you. And, they must either be:
- Your spouse or
- A veteran or active-duty service member
With VA mortgages, the co-signer must also be qualified for the loan, explains Michael Adam Perlman, assistant vice president of Silver Fin Capital Group.
The co-signer, in general, is a responsible party to the loan being repaid. This person will be required to pay back the loan on behalf of you, the primary loan borrower, should you default and fail to pay back the loan as scheduled.
Perlman notes that a co-signers credit, like yours, will be negatively affected if the VA loan goes past due or in default.
That means co-signing is serious business. Both parties should fully understand the implications of co-signing a VA loan as well as the benefits.
What To Do With A Va
Hopefully, the veteran has a will or trust that specifies who inherits the house. If there is a surviving spouse, the mortgage usually becomes that persons responsibility. If there is no surviving spouse, the veterans beneficiaries must decide what to do with the property. Here are some of your options:
- Assume the loan: When applicable, the surviving spouse assumes the debt and begins making mortgage payments in the veterans stead. The VA does not require approval for a loan transfer/assumption in this situation.
- Refinance the loan in your name: The death of a spouse or other family member can bring about financial hardship. Thats why the VA offers loan refinancing options, including the VA Streamline Refinance Loan and Interest Rate Reduction Refinance Loan . These can make your mortgage more affordable by lowering your monthly payment, interest rate, or both.
- Pay off the loan with life insurance: If the veteran had a life insurance policy that covers the remaining mortgage balance, you can use the insurance benefits to pay off the home loan. Doing so transfers full ownership to you, so you can continue living in the house mortgage-free.
- Sell the house: If youre not interested in keeping the property, or you have no way to pay the mortgage, sell the house and use the proceeds to pay off the loan. This is a better option than missing payments and allowing the home to go into foreclosure.
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What Are Va Entitlements And Why Are They So Important
A key feature of VA loans is the entitlement. A VA loan entitlement is basically the amount of the loan that the VA will guarantee to the lender if you default.
There are two types of entitlement:
- Basic entitlement: up to $36,000 for loans worth less than $144,000, or 25 percent for loans of that amount or more.
- Bonus entitlement: Up 25 percent of the Federal Housing Finance Agency loan limit, minus the basic entitlement.
For those who need to purchase a home that costs more than $144,000, the bonus entitlement can be used. For example, in most counties in the U.S., the FHFA conforming loan limit in 2021 is $548,250 and $647,200 in 2022. In that case, 25 percent of the loan amount would be $137,062.50 in 2021 or $161,800 in 2022. However, for the total entitlement, you need to subtract out the basic entitlement, leaving you with $101,062.50 in bonus entitlement money for 2021 and $125,800 in 2022.
Many lenders are willing to loan those who qualify for a VA loan up to four times the amount of their entitlement, so you might be able to get a loan for $144,000 on the basic entitlement of $36,000.
For those who live in high-cost areas, the bonus entitlement is figured in the same way, but based on the higher FHFA conforming loan limit, which is based on the county where the house is located. Before applying, check the FHFA website for more information on the loan limits in your area.