Minnesota VA Loan
Every year, Veterans Day gives us a chance to pause and honor the sacrifices, courage, and patriotism of the men and women who have worn a military uniform. America is the land of opportunity and a beacon of hope and freedom to the rest of the world because our Soldiers, Sailors, Marines, Airmen, and Coast Guardsmen have fought valiantly to defeat tyranny and terror, and protect the liberties we hold most dear. They have signed on to do a job that most could not!
Thank you to all of our veterans!
For their service and selflessness they should receive many benefits. Since, I’m a real estate broker I will discuss some of the benefits available to our Veterans as they pertain to real estate. One of the best benefits available to Minnesota Veterans is the Minnesota VA Loan to purchase or refinance Minnesota real estate. In the following blog post we will discuss some of the many benefits of using a MN VA loan to purchase a property. We will also discuss some of the guidelines and requirements needed to qualify for a VA loan.
Benefits of a Minnesota VA Loan
Here are some of the benefits of using Minnesota VA loan to purchase Minnesota real estate.
No Down Payment
Minnesota VA loans don’t require a down payment. This is great for someone with little cash for a down payment or for someone that would rather keep a little more of their cash available for other expenses.
No Private Mortgage Insurance
Normally when you haven’t put 20% down towards the purchase of your Minnesota house, the lender will require you to purchase Private Mortgage Insurance(PMI). With a Minnesota VA Loan lenders are prohibited from requiring this.
Approval with Less than Perfect Credit
The VA loan is backed up by the US government, so the lenders have less risk if the loan isn’t repaid. This allows the lenders to accept lower credit scores as their investment is protected by the government.
Lower Closing Costs
While there are still closing costs associated with a Minnesota VA Loan, they are considerably less than someone using a conventional loan to purchase a home.
Who is Eligible for a Minnesota VA Loan?
- You may be eligible for a Minnesota VA loan if you meet one or more of the following criteria:
- You have served 90 days of consecutive duty during wartime.
- You have served 181 days of duty during peacetime.
- You have 6 or more years of service in the National Guard or Reserves.
- You are the spouse of a service member who has died in the line of duty.
- Obtaining Your Certificate of Eligibility
Obtaining your Certificate of Eligibility
All recipients of a VA Loan must first obtain a Certificate of Eligibility (COE), a formal document that explains what VA entitlement you possess, through the Department of Veterans Affairs. VA Loan applicants may also obtain their Certificate of Eligibility themselves by filling out a Certificate of Eligibility Request Form (VA Form 261880). The form can be downloaded through the Veterans Administrations site and mailed directly to the VA.
Income Requirements for a MN VA Loan
Minnesota Homebuyers interested in the MN VA Loan aren’t required to reach any kind of income threshold to use their home loan benefits; however, borrowers are expected to have stable, reliable income that will cover monthly expenses – including their new mortgage payment.
Additionally, the VA requires that borrowers maintain a certain amount of income left over each month after all major expenses are paid. The excess is meant to cover typical family needs, such as food, transportation and so forth and is referred to as residual income. Residual income is a large reason why the VA Loan maintains one of the lowest foreclosure rates of all major lending options.