(Submitted by Andy Hughes.)
Buying a home can be complicated for anyone, but there are additional considerations as a veteran. During active service, building a great credit score can be challenging, and former service members can have difficulty finding a job after leaving the military.
Luckily, VA loans and other financing options exist to take the stress out of purchasing a property, and you can follow this guide from Eastern Oregon Living on how to do it.
Know What You Can Realistically Afford
Before purchasing a new home, it’s crucial that you conduct research to make sure it’s the best choice. The first and most important question to ask is whether you can afford it. As a general rule for civilians as well as veterans, your mortgage principal, mortgage interest, property taxes, and property insurance (PITI) shouldn’t exceed 28% of your monthly income.
What’s more, your debt obligations shouldn’t exceed 36% of your gross monthly income. For veterans using the VA home loan program, another important consideration is the residual income check. The VA loan application process includes an assessment of how much of your salary is left over after paying PITI to ensure you can afford essentials, such as food and transportation.
Get Your Ducks in a Row
Preparation is the key to making a sound decision when buying a home. Just like any property buyer, you’ll need to undergo a credit check to ensure you’re able to meet your monthly mortgage payments. If you have a poor credit rating, Forbes explains the steps you can take to build up your credit score.
You’ll need to have a job with a salary that meets the recommendations outlined above, not be in too much debt, and have savings to cover additional expenses such as fees and closing costs. It’s always best to secure preapproval for a homeowner loan so you know your budget.
Understand VA Home Loans
To be eligible for a VA loan, which has relaxed credit standards, low VA mortgage interest rates, and no down payment or private mortgage insurance (PMI) requirement, you must meet one of the following conditions:
- Served at least 90 consecutive days during wartime
- Completed over six years in the Reserves or National Guard
- Served more than 181 days during peacetime
- Been married to an active service member who died from a service-related disability or in the line of duty
If you don’t meet these criteria, you could consider a USDA loan, FHA loan, or a standard bank loan.
Find Your Dream Property
If you’re eligible for a VA loan, you should find a real estate agency like the Paladin Realty Team who’s familiar with the VA home buying process. They’ll likely recommend early fall as the best time to buy, as noted by Time magazine. You’ll also need to provide a VA home loan Certificate of Eligibility to verify entitlement to your mortgage lender. Aside from this, the process of buying a home is pretty much the same for veterans and civilians—stick like glue to your preferred location and property must-haves.
Finally, take your time to ensure you make an astute offer through your agent, and don’t be shy about negotiating closing costs.
Get the Home You Deserve
To buy a home as a veteran, get your finances in order, learn about the benefits you’re entitled to, find an agent who specializes in VA home loans, and purchase your dream property.
Eastern Oregon Living showcases communities, events and opportunities around Umatilla and Morrow Counties, while sprinkling in observations and insights from the Paladin Realty Team. Reach out for more info today! 541-310-9563 or 541-310-7070
(Photo courtesy of Unsplash)
