If you are shopping for a new home and are a veteran and in need of financing, a VA housing loan might be for you. A VA loan is a mortgage that is guaranteed (insured by) the Veterans Administration. There are millions of veterans in the United States that are eligible for a VA housing loan.

The VA Loan became known in 1944 through the original Servicemen's Readjustment Act also known as the GI Bill of Rights. The GI Bill was signed into law by President Franklin D. Roosevelt and provided veterans with a federally guaranteed home with no down payment.

The VA Home Loan program allows veterans with qualifying income and credit to purchase a primary residence without putting any money down towards the sale price of the home, as long as that sale price does not exceed the appraised value of the home. Veterans are eligible for loans without down payments until 2011. Veterans do need money towards closing costs as well as earnest money, which the seller generally requires when a sales contract is signed. Closing costs may be paid by the seller, which can be negotiated. Below are some important facts and information if you are a veteran considering a home purchase.

  • To be eligible for a VA housing loan, you must be a veteran that has served on active duty. A total of ninety days of service are required during wartime. The requirement is 181 consecutive days during times of peace. Click here for more information on eligibility.
  • Any itemized fees and charges related to the purchase of a property, such as inspections and appraisals may or may not be the responsibility of the veteran. It is a goof idea to check with your local VA office for a list of reasonable and customary fees veterans are allowed to pay.
  • While poor credit within the last 12 months may be a deterrent in loan approval, VA housing loans have been given to veterans who lack established credit.
  • Veterans can prepay their VA Home Loans without a penalty.