Starting the loan application process


Now that you have determined that you qualify (if you are unsure, please check your VA Loan Eligibility), you can begin the loan application process. This process includes six important steps: finding a VA-approved lender, pre-qualifying for a loan, selecting your home, drafting the purchase agreement, having the property appraised by the VA, and finalizing the loan.

To obtain a VA loan, it is important to note that the law requires that:

  • The applicant must be an eligible veteran who has available entitlement.
  • The loan must be for an eligible purpose.
  • The Veteran must occupy or intend to occupy the property as a residence within a reasonable time after loan closing.
  • The veteran must have satisfactory credit risk.
  • The veteran’s and spouse’s income, if applicable, must be stable and sufficient to meet mortgage payments, cover the cost of owning a home, take care of other obligations and expenses, and have sufficient extra for family support.

An experienced mortgage lender will be able to discuss specific income and other eligibility requirements.

Find a VA Approved Lender

Before you start the application process, it’s a good idea to get a copy of your credit report. This can be obtained from any of the three major credit bureaus: Experian, Equifax and TransUnion. Once you have obtained your credit report, the next step is to find a VA approved lender. A lender can flag any credit issues you may have and provide you with a loan estimate. Compare the prices. Compare different lenders’ closing costs (in addition to the price of the property) incurred by buyers and sellers when transferring ownership of a property (also known as settlement costs) and other costs. makes it easy to find VA approved lenders – just use our Quick formand be connected with up to three lenders.

Pre-qualification for your loan

Pre-qualifying for a loan is the best way to determine your borrowing capacity. Pre-qualification involves informing your lender of your income and assets. Based on this information, you can find out if you qualify for a given loan. Note that pre-qualification only gives an estimate of how much mortgage payment you can afford, based on the information you provide. Although pre-qualification is not a requirement, it is highly recommended. Without prior pre-qualification, you might find yourself looking for homes that you might not necessarily be able to afford.

Once you are pre-qualified, you will have a good idea of ​​the income you will need to qualify. You will also know what price range of houses you can manage, which is important for the next step.

Selecting your home

If you are pre-qualified for your VA home loan, you will have a good idea of ​​the homes you can afford. You can now begin the process of selecting your new home. Finding accommodation can be done in several ways:

  • In line: There are many web pages dedicated to listing homes for sale. These pages are often useful for finding homes that are beyond your travel reach and often include lots of photos and detailed information.
  • Calling a real estate agent: The yellow pages are a great way to find local agents. Many people use real estate agents to navigate the paperwork of buying a new home.
  • Newspapers and other guides: Classifieds, agency listings and real estate guides are a proven way to find listings for homes on the market.

Drafting of the purchase contract

Also referred to as a “contract of sale” or “contract of purchase”, this document represents the finalized terms and conditions under which the transfer of real estate will take place. A purchase contract is essentially an agreement between buyer and seller to buy an agreed property on agreed terms, whatever they may be. The purchase agreement will address among other things: restrictions and easements, liens on the property, inspections, prior leases, disclosures, preparation of documents for closing and maintenance of the property until closing .

VA Assessment

Since the loan amount cannot exceed the VA’s estimate of the property’s value, in order to finalize the loan, you must request an appraisal from the Veterans Administration. Although anyone (buyer, seller, real estate staff or lender) can request a VA appraisal, it normally comes from the lender via the internet using TAS (The Appraisal System).

It is important to recognize that although the VA appraisal estimates the value of the property, it is not an inspection and does not guarantee that the home is free from defects. Homebuyers should carefully inspect the property themselves or hire a reputable inspection company to help. VA guarantees the loan, not the condition of the property.

Finalization of the loan

If the established value is acceptable to all parties and the lender determines that you qualify based on credit and income, the loan may be approved. Most lenders are allowed to make this decision.

You (and your spouse) attend the closing of the loan and sign the note, mortgage and other related documents. The lender or closing attorney will explain the terms and requirements of the loan as well as where and how to make monthly payments. When the loan is reported to the VA, the Certificate of Eligibility is annotated to reflect the use of entitlement and returned to the applicant. The loan closing process may vary in some states. Closing costs can be significant, even with a VA loan, so get the details from your realtor before closing and avoid unpleasant surprises.

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