September 26, 2021

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Getting A VA Loan While Deployed

A large number of U.S. military personnel are stationed or stationed overseas at any one time. Although far from home, it is possible for military personnel on active duty abroad to obtain a mortgage – a VA loan or another type – and buy a house thanks to remote functions.

Should You Get a VA Loan?

Military service has many advantages, and one is that VA mortgage loan program. A VA loan enables individuals with honorable military service or eligible surviving spouses to finance the purchase of a home or refinance an existing mortgage on attractive terms. These include:

  • No credit minimum – Unlike other types of mortgages, VA loans from the U.S. Department of Veterans do not require minimum creditworthiness requirements, allowing mortgage lenders some flexibility in qualifying a borrower.
  • No deposit – You don’t need to pay a down payment to qualify for a VA loan. Mortgage lenders generally prefer borrowers to pay a 20 percent down payment on a home. However, because this is not financially feasible for many, there are insured mortgage programs that make a lot possible lower deposithow FHA loans. The VA approach is different: borrowers don’t need anything upfront.
  • No mortgage insurance – Unlike other low-down payment programs that require mortgage insurance when the borrower pays less than 20 percent, there are no mortgage insurance premiums for a VA loan. There is, however, a foresight Sponsorship feeThe cost depends on how much you (if you pay a down payment) and how many times you have used the VA loan program.

Even if you are eligible for a conventional or other type of mortgage, a VA loan can help you buy a home with minimal upfront costs. Hence, as an option, consider whether you, a family member, or a member of your household are Active Duty or a Veteran.

If you are currently on active service, you know that there is a minimum service requirement for a VA loan: 90 consecutive days. When you reach this minimum, you can apply for a Certificate of Eligibility (COE), which you will need to get the loan. To do this on active duty, you will need a signed declaration of service from your commanding officer, adjutant, or personnel officer. As soon as you have these specifications, you can apply for your COE via the eBenefits portal.

Why Buy a Home While It’s In Use?

Part of military service is the ability to move around as needed, often on short notice. If you are currently renting or are already a homeowner and need more space, you can still buy a house in the event of a deployment. The benefits of buying a home are:

  • Low mortgage rates
  • No lease (if you are a tenant)
  • Stability for family members, especially children

What should be considered when buying a home from abroad?

When you (or a family member) is out on the job and looking for a home in the market, you don’t have the option of looking for a property in person. A spouse, other family member, or a real estate agent can help, and you may even be able to take a 3D walkthrough or video tour yourself.

In addition to house hunting, you will also need help with mortgage management. Keep these three points in mind:

1. Granting a power of attorney

During your assignment, you may appoint a person or organization to represent your interests when buying a home with a representative Power of attorney (POA). To grant a POA, you will need assistance from a lawyer, legal clinic, or Judge Advocate General (JAG). Each of these professionals can recommend additional legal action based on your situation.

In many cases, military personnel will grant a spouse a POA so that the spouse can complete tasks such as signing paperwork on their behalf. When considering who to appoint, ask the following questions:

  • What powers do you allow the person?
  • Do you want to set restrictions?
  • How long is the POA?
  • Can you revoke the POA at any time?
  • Can you name a backup?

You will also want to confirm with the closing or title agent what POA documentation they will need to close your mortgage.

2. Meet occupancy requirements

A condition for VA funding is that the borrower must live at home. This can be a problem when deployed.

Generally, borrowers have a “reasonable amount of time” to withdraw after their VA loan is closed. “Reasonable” is defined as 60 days but can be longer if you can certify that you are living in the home by a specified date within 12 months of graduation. If you are on active duty and cannot meet the “fair” standard, a spouse or dependent child can live at home to meet this occupancy requirement.

However, when you are provisioned, you already meet the occupancy requirements. How outlined by VA::

“Single parents or married service members deployed from their permanent location are considered to be temporarily on duty and can meet occupancy requirements. This is true regardless of whether a spouse is available to occupy the property before the veteran returns from the field. “

3. Review of military status

It is important to check your military status before looking for a home or applying for a mortgage.

VA loans are limited to those with qualified military service. Under the Service Members Civil Relief Act (SCRA), military personnel have access to benefits like foreclosure protection. For this reason, when considering a VA loan application, mortgage lenders must verify the borrower’s active duty and other service-related information.

The Defense Manpower Data Center (DMDC) maintains a Review of military service Website. There are also commercial providers who provide this information to lenders. It is best to contact your lender for details of your requirements.

Bottom line

VA loans have unique benefits that can make home buying more affordable, and you can still get one while you (or a family member) is out on it, provided your service qualifies you. Appointment of a power of attorney can help you manage the home purchase on your behalf during your absence, and your lender can advise you on the documentation to verify your military status.

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