Pre-Approved VA Home Loans: A Short Guide to Applying for One

Finding an affordable option among the wide range of mortgages can be difficult these days, especially when the applicant has a low credit rating or limited income. But there are options, and pre-approved VA home loans offer qualifying applicants one of the most profitable mortgage options out there.

The VA has long been a source of financial aid for former members of the military, and their support when it comes to mortgages means that some real savings can be enjoyed. But for the home seeker, getting pre-approved mortgages offers other benefits as well. No less important is higher trading leverage and the ability to commit to a purchase on the spot.

But how can someone get a pre-approved VA home loan? And is the process complicated? Here, we provide a step-by-step guide so you don’t miss a thing when it comes to the real thing.

1. Complete the necessary forms

The obvious ways to get started when looking for a pre-approved VA home loan is the loan application form. This will ask for the usual personal and financial details, but if in doubt, just leave the area blank and seek the advice of the VA loan officer. It is important that all information is accurate and relevant.

A second required form is 26-1880, which confirms eligibility for a VA home loan. This is a simple form that shouldn’t take long to complete. However, it is important if there is to be any possibility of obtaining pre-approved mortgages. This form is not necessary when the applicant already has a Certificate of Eligibility.

2. Provide additional documentation

In addition to the above forms, you will also need to submit additional documentation related to your income. These include your W-2 form and perhaps a pay stub. These will provide clear confirmation of your current income, which is obviously essential when applying for a pre-approved VA home loan.

Other documentation that may be requested may confirm other payments, for example disability payments or military retirement payments. These items are covered in a VA Award Letter and Retirement Statement, respectively.

3. Checking your credit history

The loan officer will inevitably want to see your credit history; however, it is a key condition for obtaining pre-approved mortgages. The check will analyze your credit report, where you can see details of past loans and payment patterns. If there are defaults, bankruptcies, or even liens on your record, they will be found.

Credit scores of around 620 are considered high enough that approval for a VA home loan is likely, but anything lower than that is likely to preclude any pre-approval. If the application is rejected, the loan officer is required to explain why.

4. Loan analysis

The last step in our guide is for the lender to take a closer look at the details of the proposed mortgage. Getting pre-approved VA home loans is a good idea, but it still depends on whether or not the mortgage is affordable.

The lender will examine the information provided, especially income and existing debts, and determine whether or not the loan is affordable. If so, obtaining pre-approved mortgage funds becomes a mere formality.

Upon approval, the lender will send a pre-approval letter confirming the amount available, which can be given to property sellers to confirm that funds are available. There will also be some disclosures that must be signed and sent immediately, but are not binding.

And remember, pre-approved VA home loans are generally good for 90 to 120 days, which is long enough to find your new home.