Ninety days active duty with the Active Reserves or National Guard in wartime could mean eligibility for the VA Guaranteed Home Loan with no down payment.
Reservists and National Guard can qualify if they have spent more than six years in the reserves or national guard, or if they have spent 90 days or more on active duty during wartime. The current Gulf War period started on August 2, 1990 and will continue until a future date. So any Reservists and National Guard serving form 90 days or more during that period should qualify for a VA Home Loan.
There are also eligible periods for World War I, World War II, Korean conflict, and the Vietnam era. Service during those periods could also mean eligibility for a VA Home Loan.
Active Reserve and National Guard members are also eligible for the VA Home Loan with six years service without the 90 days active duty requirement.
VA Home loans have no down payment in most cases, have no private mortgage insurance, allowing all closing costs to be paid by the seller and VA may offer some assistance if the veteran/active duty/reservist/national guard borrower runs into difficulty. Interest rates on VA loans are also very comparable with similar conventional loans and in cases of somewhat lower credit scores, often better.
VA Home Loans are available for either purchase of a personal residence or refinance of your current residence to a VA Home Loan. Most lenders limit the refinance to 90% loan to value, however if you currently have a VA Home Loan, an interest rate reduction refinance loan (IRRRL) is available from most lender to 100% loan to value.
VA borrowers do not have to be first time buyers and the VA loans are assumable in the future. You can contact VA directly to determine eligibility or work with a lender to submit the proper paperwork to get a certificate of eligibility.
Home loan benefits can also be restored if it was used previously and paid off or assumed by an eligible veteran.
About the author: Fred Chamberlin is a senior loan officer with Guild Mortgage Company in Oak Harbor. He has been in the mortgage origination business for over 20 years and in the lending business for over 30 and authors a number of mortgage related blogs.