With Joint Base Lewis-McChord to the south and Naval Base Kitsap to the west, there’s a fairly large military presence in and around the Seattle metro area. As a result, there are many people who could benefit from using a VA home loan to buy a house in Seattle. This guide explains the benefits, eligibility requirements, and other aspects of using a Seattle VA home loan.
VA loans are very attractive to eligible veterans who are looking for a loan program that offers them more flexibility and affordability, especially when it comes to interest rates, down payments, and lending requirements. VA loans can be a life-saver for those who may have trouble securing a different type of loan to finance a home purchase.
About the VA Loan Program
A VA loan is a mortgage loan that is guaranteed by the federal government, via the U.S. Department of Veterans Affairs. This program was started in the 1940s, near the end of World War II. It’s primary purpose was (and still is) to make homeownership more affordable for eligible military service members, veterans, and surviving spouses.
Specifically, the VA loan program gives borrowers access to low-cost financing. When using this type of mortgage, borrowers are able to finance 100% of the purchase price. You won’t find this level of financing anywhere else, when buying a home in Seattle.
Benefits for Seattle Home Buyers
As mentioned, this program offers 100% financing for home buyers. That means eligible borrowers can buy a house with no down payment whatsoever. That’s the primary benefit of using a Seattle VA loan, but there are other advantages as well.
Another benefit is that borrowers can often qualify for 100% financing without having to pay mortgage insurance. Government or private mortgage insurance is usually required for loans that account for more than 80% of the property value. But this is not the case with Seattle VA loans.
Who Is Eligible for the Program?
This program is open to most military service members and veterans, as well as surviving spouses in some cases.
In general, the following groups are eligible for VA financing:
- Active duty military members with at least 90 days of continuous service.
- Veterans who have served for at least 90 consecutive days during wartime or 181 days during peacetime.
- Selected Reserve and National Guard members with at least six years of service. (Those who served during the Gulf War might be eligible with at least 90 days of service.)
- Surviving spouses are generally eligible for Seattle VA loans. According to official guidelines, eligibility is extended to the “Unremarried spouse of a Veteran who died while in service or from a service-connected disability, or spouse of a Servicemember missing in action or a prisoner of war.”
Learn more about eligibility requirements
In order to apply for a VA loan in Seattle, borrowers must first obtain a Certificate of Eligibility (COE) from the Department of Veterans Affairs. This document shows the mortgage lender that you are, in fact, eligible for a VA-guaranteed home loan.
VA Loan Limits Eliminated
One of the newest benefits of getting a VA loan is the fact that eligible veterans no longer have to abide by loan limits in their county. Every year, new loan limit amounts are established for VA, FHA, and conventional loans. These loan limits are usually increased every year to reflect the increase in home prices across the country.
If these loan limits are exceeded, they are considered “jumbo loans” and are subject to more stringent lending criteria.
But VA loan limits are no more! Before, veteran borrowers would have to make sure they stayed under the loan limit in their county in order to be able to put no money down. If they borrowed more than the VA loan limit in their county, they would be subject to paying 25% on the amount in excess of the loan limit.
But thanks to a recently passed law, veterans who qualify for a VA loan will still be able to take advantage of a zero down payment option, regardless of the loan size they take out.
It should be noted, though, that veterans will still have to prove their creditworthiness and income to their lenders, who will have a say in the loan amount borrowers may take out. In addition, borrowers who already have more than one VA loan or have defaulted on one in previous years may still be subject to a down payment if they exceed a certain loan amount.
Check out our mortgage loan limit tool for conventional, FHA, and VA loans.
Ready to Move Forward?
Would you like to use a VA loan to buy a home in Seattle? We can help. Sammamish Mortgage has been helping borrowers in WA, ID, OR, and CO since 1992. We can help you every step of the way, from application through closing. We can even pre-approve you for a mortgage loan, to give you a much-needed advantage in the real estate market. Contact us for more information on the mortgage programs we can offer you!