(Mar 21, 2023)
Housing prices in the state have climbed by more than 78 percent over the last five years, and the median price is currently $378,104, just a few hundred dollars below the national average.
Most Floridians are now turning to cheaper mortgage options, down payment assistance programs, and other subsidies to afford to pay for their homes. One of these programs is the VA loan, exclusive to those who've served or are still serving and their families. The mortgage program is available throughout the state, and this is a look at how to apply for the loan in Washington County.
Are you a Hometown Hero? Find out your eligibility for the Hometown Heroes Loan Program in Washington County, Florida.
What are VA Loans?
VA home mortgages are home loans available exclusively to people who've served or are currently serving and their families. They are offered by loan companies and insured by the Dept. of Veteran Affairs, aka DVA.
The DVA insures up to 1/4 of the mortgage, making these loans less risky for lenders and allowing them to provide more attractive terms, including competitive rates, 0% down payment, zero private mortgage insurance, and relaxed qualification requirements.
Even though VA loans are a specific mortgage product, they are no more time-consuming or complicated than other types of mortgage loans. The mortgage program, eligibility requirements, and application procedures are covered in great detail here.
Types of VA Loans Available in Washington County, Florida
Folks who qualify for the VA mortgage program can select from many solid home finance options, including:
VA Purchase Loan
This 0% down payment VA loan is available to veterans, active-duty service members, and their families to purchase new or used homes, including single-family homes, condominiums, duplexes, or manufactured homes.
Borrowers can also use this loan to refurbish their homes. To qualify for this loan, one must provide a certificate of Eligibility, meet the lender's credit, income, and other requirements and live in the home they are buying.
VA Energy Efficient Mortgage
The VA Energy Efficient Loan option is provided as part of a home purchase or refinancing to assist borrowers in implementing energy-efficient improvements such as solar energy, cooking systems, and thermal windows in their homes.
Native American Direct Loan
This VA loan is only available to Native American veterans or veterans with Native American spouses. Those who receive it may use it to construct or remodel residences on federal trust land.
What Are the Requirements for a VA Loan in Washington County, Florida?
Veterans requesting a VA loan must provide a certificate of Eligibility (COE). The applicant has served the required time and qualifies for the VA mortgage program. The COE can be requested from the DVA.
While some financial institutions have more stringent underwriting rules, VA loans are frequently more accessible to obtain than regular mortgages since the government protects against the risk of default.
What Is the Minimum Credit Score Required?
VA loans typically have more lenient credit requirements than other mortgage programs since the DVA guarantees up to 1/4 of the loans making them lower-risk alternatives for lenders who can extend the loans to more veterans.
The DVA does not specify a minimum FICO score, just that the lenders extend loans to applicants they consider tolerable risks. However, most VA loan lenders require that applicants have a FICO score above 620.
What If My Score Is Lower Than the Required Minimum?
A lower FICO score does not preclude you from owning a property via the VA mortgage program. The figure is constantly changing. Furthermore, credit reports aren't the only factor lenders check when assessing applicants. They consider various other factors, too, including applicants' DTI, and may lower the FICO score requirement.
If you have a low score, you can work to improve it. However, if you qualify with a lower credit score, you may have to adhere to strict lender guidelines to keep the mortgage. Otherwise, you risk it being repossessed. Therefore, maintaining a high credit score is always advantageous.
What Are the Terms of VA Loans?
VA loans have more favorable conditions than conventional mortgages and government lending schemes. Some of the terms and benefits of VA loans are as follows:
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Loosened qualifications requirements. Applicants with low credit scores and high DTIs are eligible for the loans.
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No deposit is required unless the issuer requests one if the home purchase price exceeds the specified value.
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Loan rates are highly competitive. They typically vary between 0.25 and 1 percent less than equivalent regular loans.
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Private mortgage insurance isn't required.
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The seller may fund the closing costs, which are generally minimal.
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The borrower will not be punished if they repay their loan early.
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To lessen the risk of default, subsidies and other forms of help are available.
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VA funding fees may be charged.
- VA loans can be refinanced into more favorable mortgages.
What Exactly Is the VA Funding Fee?
The VA funding fee is applied to borrowers and collected by the DVA department to keep the mortgage program running for future generations of veterans, military service members, and their families. Additionally, it spares taxpayers from extra expenses.
The amount of the VA funding fee is determined by the borrower's circumstances. Those using the loan for the first time typically pay 2.3 percent of the purchase price of their home, while repeat users pay 3.6 percent. Meanwhile, those refinancing their loan pay a 0.5% fee no matter the number of times they've used the mortgage program. The funding charge might be rolled into the loan or paid a la carte.
Furthermore, some vets and their families are exempt from paying funding fees. These include vets who receive compensation for a disability connected to their service. The same exemption applies to survivors' spouses eligible for the VA mortgage program. However, only the DVA can decide who should pay the funding fee and who should not.
What Are the VA Loan Limits in Washington County, Florida?
The VA loan restriction for vets with full entitlement was lifted in 2020, which means applicants can borrow any amount they need, and the DVA will cover up to 1/4 of the total loan provided the applicants have full entitlement. To qualify for full entitlement, you must either have never used the VA program before, have completely repaid a past VA loan and sold the home, or have repaid the entire loan following a short sale. Or fully repaid the loan following a short sale.
However, VA loan limits might apply to veterans who do not have full entitlement. For example, if you have a VA house loan that you are still repaying, the DVA will only insure 1/4 of your county's loan maximum, less whatever entitlement you have already utilized. Speak with an approved VA loan officer to see how VA loan limits may apply to your case.
How Can I Apply for A VA Loan?
Consult a reliable lender who is familiar with VA loans. If you've served, are currently serving, or are a spouse of a person who has served, a professional lender can assist you in making the most of this mortgage program. Pre-approval is frequently the preliminary step, and it can be done swiftly in person, over the phone, or online.
Always get your loan request pre-approved before making an offer on a property. A pre-approval letter explains your purchasing power and shows sellers and their representatives that you have the funds to finish the transaction.
What Are the VA Loan Interest Rates?
Lenders establish VA loan interest rates as per market conditions. Nonetheless, to remain competitive, most of them provide VA loan rates similar to one another. However, asking around and comparing what different lenders offer may help you get a better deal. Your VA home loan rate will be determined by several factors such as:
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Your credit scores
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Type of loan - adjustable-rate, fixed-rate, refinance, and huge jumbo loans.
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Debt payback history - Those who've previously been able to repay loans swiftly may be offered better rates
- Loan duration - longer loan terms often fetch higher interest rates.
Although these factors will lock the amount of interest charged on your VA loan, you can still take various actions to ensure a favorable rate.
How to Negotiate for Lower VA Loan Rates
Many Americans are ignorant that they can negotiate lower rates on their loans. Most borrowers don't ask around and compare offers. They quit just after getting the first offer. However, studies suggest that looking around for better interest rates can save a borrower as much as $3000. It's possible to negotiate a favorable rate on your VA loan. Here's how:
Get many offers and compare them
You are not compelled to take the first VA loan deal you get. It's wise to shop around and compare offers from different lenders. Avoid being duped by amazingly upfront low rates, closing fees, and points. Consider the entire loan cost while deciding on a lender.
Ask your bank to match a lower rate VA loan deal from another provider
When you have several offers, go back to your bank and request that they match the best one. If your lender is determined not to lose business, they will. Remember to acquire all of the deals in writing before returning to your bank to renegotiate.
Enhance your VA loan application
Getting better loan rates is possible by raising your creditworthiness and debt-to-income ratio. Most lenders connect strong credit with a lower chance of default and, as a result, offer lower rates. Most VA lenders accept credit scores higher than 620 and DTI lower than 42%. If your numbers are off, you can take the following actions to raise them:
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Settle your bills on time
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Pay all or some of the debts in collection accounts
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Lower outstanding debt
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Check your credit reports for errors and report any probable fraud.
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Maintain your accounts to establish a long credit record.
- Increase your income
Make a larger down payment
Even if VA loans do not need down payments, saving for one can significantly reduce your outstanding debt responsibilities.
Lock the rate
Once you've obtained a decent VA loan rate, lock it in. A rate lock ensures that the interest rate remains fixed during the loan's term. Sparing you from the market volatility when interest rates fluctuate.
VA Loan Refinancing
The DVA provides the following options for refinancing a VA loan.
VA IRRRL
The VA IRRRL is short for VA Interest Rate Reduction Refinance Loans. These refinancing solutions are exclusive to veterans who currently have active VA loans. These refinancing solutions are also known as VA Streamlines since they are simple, low-cost refinancing. They do not demand an assessment, proof of income, or credit underwriting.
VA Cash-Out Refinance
Homeowners can refinance their loans and borrow funds from their equity share in a home through the VA Cash-Out Refinance. Qualified individuals can refinance up to 90% of their home value. This option is available to all veterans, regardless of whether one has an active VA loan.
Is It a Good Idea to Take A VA Loan?
A VA loan is one of the veterans' most robust financing options. VA loans have low to zero down payment demands, flexible credit requirements, lower interest rates, and do not require private mortgage insurance. Furthermore, the loans are not a one-time offer as you can borrow from the program repeatedly.
However, keep in mind that circumstances differ from homeowner to homeowner. It would be best if you discussed your situation with experienced VA loan personnel so they can help you decide whether the loan program is right for you and how to make the most of it.
About Washington County, Florida
Washington County, Florida, is a homey little town in the northwestern part of the state. It's surrounded by other boonies like Panama City and Pensacola as well as Tallahassee to the east but don't worry - you'll still find all the conveniences of a big-city life no matter where you live here! Many national forests here exist, including Tate's Hell State Forest and the Apalachicola National Forest.
It was established in 1825 and named after George Washington. At first, the county was more significant than Delaware! However, over time its size has been reduced due to territorial adjustments. Regardless, it remains one of the best places to live in Florida owing to its multicultural population, beautiful landscape, and great amenities. Here is a look at activities and things to enjoy in the county.
Seacrest Wolf Preserve
Do you like wolves? Visit the Seacrest Wolf Preserve, Inc to interact with them and learn more about the species. This non-profit wolf sanctuary offers a wide range of tours that teach about wolf and wildlife conservation in Northwest Florida. There are over a dozen wolves here to get your blood pumping! Kids are welcome too, and you can take photos too.
Falling Waters State Park
Do you want some peace and quiet? This lovely path through the woods leads to Florida's tallest waterfall. It's a delightful trip on a well-kept boardwalk through incredible natural beauty, with species like butterflies, lizards, frogs, and tons of lush greenery.
The water descends 73 ft into a cave system or grotto. There are two observation platforms at the end. There is also a beautiful lake with a swimming strip and picnic spaces in many locations.
Sunny Hills Golf Course - Sunny Hills, Florida
Sunny Hills Golf Course features a fantastic practice facility for golfers. It is an 18-hole public golf course that is accessible throughout the week. The course has different kinds of tees for various skill levels. The fairways and greens are both Bermuda grass. There's also a large pro store with everything you need for the sport and gifts for souvenirs. A restaurant is open on-site.
Spanish Trail Playhouse - Chipley, Florida
The Spanish Trail Playhouse is a little theater company located in Chipley. It's been operating for years, producing high-quality theatrical productions for locals and visitors. The productions range from concerts and artist series to big musicals like Beauty and the Beast. Go out and support local artists.
Horseback Riding
If you love nature and horse-riding, this Florida countryside has miles of lovely scenery to explore on horseback? Explore sandhills, open wiregrass plains, creeks, and pine forests. Washington county is great for horse lovers. Enjoy the great outdoors, and participate in horsemanship and riding programs.
Other Washington, Florida activities include Rving and camping, freshwater fishing, canoeing, diving and tubing, geocaching, and sampling fresh produce at various farmers' markets.
Wrap-Up
The VA loan program guarantees that veterans, active-duty members, and their families will be compensated for their service to the country. Compensation comes from low-interest fixed-rate loans with no down payment or private mortgage insurance.
These loans can be used to buy a home, construct a new one, remodel, or even upgrade to energy-efficient features. These loans are made accessible by various lenders approved by the DVA. Don't enter into a terrible deal with a shady lender; obtain all the information before deciding on a VA lender.
(Mar 21, 2023)
