Myths about VA Loans

Occasionally, rumors emerge about specific mortgage products; the VA home loan is no exception. With that in mind, let’s debunk some of the myths about VA loans. Please note, Wholesale Capital Corporation is not affiliated with or acting on behalf of or at the direction of the Department of Veterans Affairs (VA) or any government agency or government-sponsored entity.

Myth #1: There are other ways to get a no money down home loan.

For the average military borrower, the VA loan is the only viable no money down mortgages in existence (unless your state has a comparable program). The only other option is a USDA loan, which strictly applies to qualifying rural properties.

Myth #2: VA loans are slow to process.

At Wholesale Capital Corporation, our process of originating VA loans is generally no faster or slower than any other type of loan. The paperwork involved is comparable to that of a conventional or FHA loan, and closing times are relatively the same as well.

One thing that might slow down a VA loan is the eligibility Certificate of Eligibility (COE), which is a document that must be obtained by the borrower. Borrowers who are serving in active duty can get this certificate after a Statement of Service document is signed by the appropriate military personnel. Borrowers who are discharged veterans can obtain the certificate of eligibility by signing a request form provided by their loan officer, and presenting a copy of the DD214 papers.

Myth #3: Veterans need perfect credit to qualify.

This is a myth, if for no other reason than the fact that a “perfect” credit score is 850. The truth is, many lenders offer more flexibility to VA loan borrowers and WCC is no exception. Provided that borrowers meet the requirements for income and VA eligibility, we are often able to approve VA loans with a credit score of 580 or higher. And remember, no down payment is required for VA loans.

Myth #4: A VA loan makes it harder to work out a home occupancy agreement in the event of a divorce.

This is a myth that should be refuted once and for all. VA loan or no VA loan, a divorcing couple can work out a home occupancy agreement with their attorney. They can decide whether the non-military ex-spouse stays on the mortgage and occupies the home, or if that spouse will be removed from the mortgage. It’s no “messier” than any other mortgage implications in a divorce.

Myth #5: The purchase must happen when the military spouse is not deployed.

This is also untrue. Over the past decade, many of our VA borrowers have purchased a home while the military spouse is deployed. The way to do this is with a power of attorney. A power of attorney allows the service member to authorize the spouse to enter into contracts on their behalf – contracts that include home loan documents. Your loan officer can provide you with a power of attorney certification form that initiates this process.

As you can see, the most common myths about VA loans are just that: myths. To get the most factual, updated and accurate information on the VA loan program, contact Wholesale Capital Corporation at (855) 640-2020. A WCC loan officer will be glad to answer your questions.

Wholesale Capital Corporation is not affiliated with or acting on behalf of or at the direction of the Federal Housing Authority (FHA), the Department of Veterans Affairs (VA), or any government agency or government-sponsored entity. WCC is licensed by the California Bureau of Real Estate, Broker License #01147747 and CA Finance Lender’s License #603K610. Also licensed in Arizona by the Arizona Department of Financial Institutions, MB #0926199. Equal housing lender.