Is It Harder to Buy a Home with a VA Loan?

Beautiful modern home with a American flag out front

If you’re considering buying a home with your VA loan benefits, you might have heard the rumors that using your benefits will complicate the process.

However, these rumors are just that: rumors. As one of the best mortgage programs for buyers, the VA loan program can help save you thousands of dollars over the life of the loan, through a lower interest rate, no down payment requirement, and no need to pay for mortgage insurance. And it won’t be any extra hassle for your seller.

Despite these facts, you still might be hesitant to use your VA loan, thinking you could run into trouble. To help ease your mind, and the mind of a seller, here are three truths about using a VA loan to purchase a home.

1. VA Loans Close Just as Often as Other Loan Types

One of the most common misconceptions about VA loans is that they’re less likely to close compared to other loan types.

However, according to Ellie Mae’s Origination Insight Report from February 2019 (the most recent as of this publishing), the rate of closure for VA loans is almost always within 1 or 2 percentage points of conventional loans, as well as the overall average for all loan types. And some months even show a higher close rate for VA loans.

Another fact to keep in your pocket? While a lot of first-time homebuyers like to go with FHA loans, they actually close the least often. From February 2018 to February 2019, VA loans closed at a significantly higher rate than FHA loans.

If the seller of the home you’re interested in buying expresses this concern, now you have the facts to persuade them that using a VA loan does not add additional risks to closing.

2. VA Loans Don’t Take a Lot of Extra Time to Close

While VA loans do, on average, take a little bit more time to close, it’s usually only two or three days longer than the average for all loan types.

However, in order to make sure your VA loan is the quickest it can be, you’ll want to choose the right lender.

Basically, pretty much any lender can do a VA loan. However, only some are able to do them without VA oversight. If your lender is less experienced and doesn’t have automatic authority, they have to submit your loan to the VA, which slows down the process.

So, when choosing your lender, you should find one that is LAPP-approved, which means they’ve qualified to participate in the VA’s Lender Appraisal Processing Program. As a LAPP-approved lender, they’ll have authority to request, process, and approve your appraisal without directly involving the VA.

You’ll also want to find one who has been granted “nonsupervised automatic authority” by the VA. In order to achieve this status, the lender must regularly complete a certain number of VA loans and meet a minimum requirement for years of VA loan experience.

At the risk of sounding too self-promoting in a blog post, we wanted to take a second to mention that Low VA Rates just so happens to be both LAPP-approved and a nonsupervised lender. In case you might be wondering.

3. VA Appraisals Fairly Evaluate the Home

One of the conditions of purchasing a home with a VA loan is that it must meet the VA-specific appraisal guidelines. While the guidelines themselves are a little different, the appraiser doesn’t work for the VA. In fact, they do all types of home appraisals for multiple loan types.

This means they won’t treat the appraisal any different just because it’s being purchased with a VA loan. How they value the home will not be influenced in any way.

The fact is, the determination of home value doesn’t have anything to do with the loan type. It is generally based on the objective condition of the home, the value of the homes around it, and other factors unrelated to how you plan to purchase the property.

The only way your VA appraisal will be different from any other type of home appraisal is that the appraiser is specifically tasked with making sure everything meets the VA’s minimum property requirements (MPRs), which is a slightly longer list that helps ensure the home is “safe, structurally sound, and sanitary.”

Use Your VA Loan to Buy a Home with Confidence

If you’re one of the few who qualify for a VA home loan, you deserve to take advantage of it. Out of all the home loan programs, it offers the most benefits to you as a buyer, so don’t let misinformation or rumors keep you from what you’ve earned as one of our nation’s heroes.

Also, don’t hesitate to give us a call if you have any other concerns or questions about using a VA loan. When you talk to one of our expert VA loan officers, there’s never any obligation to choose us as your lender. We just want to help you, whether that’s by simply providing information or actually originating your loan.

You can speak with one of our loan officers at (866) 569-8272.

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