VA Home Loan Benefits and the Pre-Approval Process

VA loans boast a number of significant benefits that make them especially attractive to Veterans, active military and surviving spouses.

VA home loan advantages include:

No down payment: VA loans do not require a down payment, meaning that you can finance 100% of the purchase price of the home you are wanting to buy.

This is a huge benefit for those who may not have the savings for a down payment or who want to use their savings for other purposes.

No private mortgage insurance (PMI): When a down payment of less than 20% is made on a home, PMI is usually required.

Unlike with some other loan types like the FHA loan or Conventional loan, VA loans do not require borrowers to pay PMI, saving you even more money each month.

Competitive interest rates: VA loan interest rates are lower than those for conventional loans, making monthly payments more affordable.

Flexible credit requirements: VA loans have more flexible credit requirements than other loan types, making them easier to qualify for.

CooleHome, has a minimum credit score requirement of 620 for VA loans. On a case by case basis we will consider a score as low as 580.

No prepayment penalties: VA loans do not penalize borrowers for paying their loan off early.

Photo by Brett Sayles from Pexels

VA Loan Pre-Approval

If you’re considering a VA loan, getting pre-approved is a key first step.

Pre-approval means that the lender has reviewed your financial information and determined that you are eligible for a VA loan and that you have the ability to afford the mortgage.

This gives you a good idea of what you can afford and lets the seller know that you’re serious about buying the home.

Real estate agents typically won’t show you property until you have a pre-approval in hand.

So what does it take to get preapproved?

The process of getting pre-approved for a VA loan is similar to that for other types of loans. You’ll need to provide your lender with some basic information, including:

Your name, address, Social Security number, date of birth, marital status, credit scores, employment history, and income information.

Documentation will also be required to verify your financial status.

In general you’ll need to provide proof of your income, employment history, assets and other financial information.

This information is used to determine whether you’re eligible for a VA loan and how much you can get approved for.

Documents needed for a VA pre-approval

Proof of income paperwork consists of the following:

If you are working for an employer as a W2 employee – the last 2 years of W2s and last 30 days of paystubs will be needed.

If you are self employed – last 2 years of tax returns for business and personal.

If you are retired or disabled – most recent award letter or stubs will be required.


Last 2 months of bank statements, most recent quarter of 401k , IRA, Stock statements.

If you currently own a home, a mortgage statement will be needed.

Bankruptcy or Foreclosure

If you’ve had a bankruptcy in the last 7 years, your bankruptcy paperwork will be required.

If you’ve had a foreclosure or short sale, we will need the address of the property that was foreclosed on.

Keep in mind that the preapproval process may take a few days, so be sure to start early if you’re planning to buy a home in the near future.

Once you are pre-approved, you’re ready to start shopping for your dream home!

Types of properties that can be purchased with a VA loan

As a qualified veteran, you can use your VA home loan benefit to purchase a single family residence, including a townhouse or condo unit in a VA-approved project. You can also use your VA loan to buy a manufactured home, or to finance the construction of a new home.

Other types of properties that may be eligible for financing with a VA loan include:

  • Multi-unit dwellings (up to four units)
  • Mobile homes on permanent foundation (double-wide)
  • Condos
  • Townhomes

Keep in mind: VA program is only for primary residences. If you plan on purchasing a multi-unit property, you will be required to occupy one of the units as your own residence.

Costs associated with a VA loan

When you are taking out a VA loan, it is important to be aware of the associated closing costs. While there is no down payment required, you will still need to pay for things like the VA funding fee, appraisal fees, and buyer closing costs.

The VA funding fee is a one-time fee that is charged by the Department of Veterans Affairs. This fee helps to offset the cost of the program, and it varies depending on your military service history and the size of your loan.

When purchasing a home, this is the only fee that can be rolled into the loan, and 99% of buyers typically roll it in.

If you are a disabled veteran receiving disability pay from the VA, you are exempt from paying the funding fee.

Appraisal fees are charged by the lender in order to have an independent third party appraise the property you are buying.

This appraisal is used to determine the value of the property, and it is requirement for all VA loans except on a VA IRRRL refinance.

Buyer closing costs are the fees that are associated with the closing of your loan, and are charged by the lender and the escrow/title company.

These costs can include things like the origination fee, title insurance, escrow fees, homeowners insurance, notary fees, county recording fees, etc.

Closing costs typically range from 2-3% of the total loan amount, and they can vary depending on where you live.

What are the Eligbility Requirements?

  • You have completed at least 90 days of active duty service.
  • You have at least six years of service in the Reserves or National Guard .
  • You have served at least 181 days of active duty service during peacetime.
  • You have 90 days of cumulative service under Title 10 or Title 32. For Title 32 service, at least 30 of those days must have been consecutive.
  • You’re the spouse of a military service member who died in the line of duty, or as a result of a service-related disability.

What is the Credit Score Requirement for a VA Loan?

Veterans Administration doesn’t set a required minimum credit score for a VA loan, but the mortgage lenders who finance the loan will want to see a credit score.

Coole Home has a minimum credit score requirement of 620.

Learn More: VA Loan Requirements

  • Are you looking to buy or refinance a home?
  • What is your price range?
  • Do you currently own a home?
  • What type of property are you buying?
  • When are you planning to make your home purchase?
  • Have you (or your spouse) ever served in the US military?
  • Have you declared bankruptcy in the past 7 years?
  • Is this your first time purchasing a home?
  • What is your current credit score?
  • What is your email address?
  • What is your name?
  • What is your phone number?


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