VA home loan guaranty, certificate of eligibility, and property tax credits

Contributed By Jennifer Watkins-Schoenig

Director of Muscatine County Veterans Affairs

What is the VA Home Loan Guaranty program? Though often thought of as a VA Home Loan, the VA does not lend any money, but it does guarantee the loan to the bank. This guarantee protects the lender in case a veteran would be unable to repay the loan. The good news for veterans is that this guarantee enables lenders to offer competitive rates and terms. Some other important features of this benefit include: no down payment (with some exceptions), ability to finance 5% VA funding fee (fee waived if veteran receives VA compensation), no PMI required, and closing costs are similar to, or lower than, other financing types. In order to apply for a VA loan, a veteran must first obtain a certificate of eligibility. This can be done by mailing a form to the regional loan center, applying online with eBenefits, or possibly contacting the lender directly.

In the meantime, it is a good idea to meet with lenders to determine whether they offer VA loans, how their rates compare to other lenders, and what your preapproved loan amount is. It is important to note that the veteran will have to meet the lender’s requirements in order to qualify. After you sign the paperwork to buy your home, don’t forget to look into the property tax credits that you may be eligible for. It is important to do this right away; otherwise, you may forget and spend more on taxes.

Muscatine and Louisa County Veteran Affairs are looking for volunteers to drive veterans to and from the Veterans Affairs Hospital and Clinics in Iowa City and Coralville for medical appointments. The vehicle, fuel, and at least one meal are provided. Flexible scheduling is available. Please contact Jen at 563-262-4162 for more information.