Does the idea of purchasing a residence in Utah appeal to you as a veteran or active service member? If it does, you likely qualify for a home loan through the U.S. Department of Veterans Affairs (VA). If the possibility of getting a VA home loan that requires no money down and offers low monthly payments seems attractive, you have an opportunity to make it happen. The lending limit for a VA loan in Utah is zero down on a purchase of as much as $417,000.
At America West Financial Home Loans, we welcome your questions about the VA loan process that can provide funds to you for a new home in Utah. As mortgage brokers, we can help you achieve a rewarding goal of owning a home of your own. To get started, call America West Financial Home Loans at 801-957-0155 today.
What is a VA Loan?
The VA backs mortgage loans that give you access to funds from private lenders as qualifying military personnel or as veterans, service members and eligible surviving spouses who choose to buy a home. With a guarantee from the VA, you can qualify to receive better terms and favorable treatment as an incentive to home ownership.
Veterans of World War II were the first to have access to VA Home Loans. The Servicemen’s Readjustment Act, a benefits package that you may know as the GI Bill of Rights, offered home loan guarantees to returning veterans. In the years between 1944 and 1952, the VA provided home loans for 2.4 million veterans of WWII.
Even though the loans carry the name of the VA, the agency only administers funds that originate from private lenders. Backing by the VA provides assurance of reimbursement to lenders if a borrower defaults on a loan. Because of government guarantees, lenders offer VA loans that provide borrowers convenient access to funds at an acceptable price. In Utah, you can use a VA home loan to buy or build a traditional home or condo as well as a manufactured home, including the price of the lot. The VA requires the borrower to use the property as the primary residence.
Benefits of a VA Home Loan
The numerous benefits that come with a VA loan help you realize the gratitude of a grateful nation that appreciates your service. Knowing that you do not need perfect credit may encourage you to take a look at the advantages of getting a mortgage loan that comes with a government guarantee. Consider these options that work in your favor:
- Your VA loan needs no down payment is required.
- You are eligible for 100 percent financing.
- No requirement for private mortgage insurance.
- Your terms are for a 30-year fixed loan.
- Interest rates are negotiable, and they are usually close in value to Federal Housing Administration interest rates.
- A third party who receives credit approval from the VA can assume your loan.
- As a buyer, your closing costs have an upper limit. The limit that the VA places on fees affects the amount that a lender can require for closing costs. A seller can choose to pay all of the costs at closing that relate to your mortgage, as much as 4 percent for judgments or collections and your prepaid expenses. By lowering the amount that you owe, you reduce your debt to income ratio.
Eligibility Requirements for a VA Home Loan
| Status | Qualifying Wartime & Peacetime Periods | Qualifying Active Duty Dates | Minimum Active Duty Service Requirement |
|---|---|---|---|
Active Duty |
Any | Any | 90+ continuous days |
National Guard & Reserve Member |
Gulf War | 8/2/1990 – Present | 90+ continuous days |
National Guard & Reserve Member |
Were discharged honorably, OR Were placed on the retired list, OR Were transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable, OR Continue to serve in the Selected Reserve |
8/2/1990 – Present | 6+ years |
| Status | Qualifying Wartime & Peacetime Periods | Qualifying Active Duty Dates | Minimum Active Duty Service Requirement |
|---|---|---|---|
Veteran |
World War II | 9/16/1940 – 7/25/1947 | 90 total days |
| Post World War II | 7/26/1947 – 6/26/1950 | 181 continuous days | |
| Korean War | 6/27/1950 – 1/31/1955 | 90 total days | |
| Post Korean War | 2/1/1955 – 8/4/1964 | 181 continuous days | |
| Vietnam War | 8/5/1964 – 5/7/1975 *For Veterans who served in the Republic of Vietnam, the beginning date is 2/28/1961 |
90 total days | |
| Post Vietnam War | 5/8/1975 – 9/7/1980 *The ending date for officers is 10/16/1981 |
181 continuous days | |
| 24 Month Rule | 9/8/1980 – 8/1/1990 *The beginning date for officers is 10/17/1981 | 24 continuous months, OR The full period (at least 181 days) for which you were called or ordered to active duty |
|
| Gulf War | 8/2/1990 – Present | 24 continuous months, OR The full period (at least 90 days) for which you were called or ordered to active duty |
The spouse of a Veteran can also apply for home loan eligibility under one of the following conditions:
- Unremarried spouse of a Veteran who died while in service or from a service connected disability, or
- Spouse of a service member missing in action or a prisoner of war.
- Surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003 (Note: a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must have applied no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 6, 2003 that are received after December 15, 2004.)
- Surviving Spouses of certain totally disabled veterans whose disability may not have been the cause of death.
You may also apply for eligibility if you fall into one of the following categories:
- Certain U.S. citizens who served in the armed forces of a government allied with the United States in World War II>
- Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with World War II service, and others
- + Service Member
-
Status Qualifying Wartime & Peacetime Periods Qualifying Active Duty Dates Minimum Active Duty Service Requirement Active Duty
Any Any 90+ continuous days National Guard & Reserve Member
Gulf War 8/2/1990 – Present 90+ continuous days National Guard & Reserve Member
Were discharged honorably, OR
Were placed on the retired list, OR
Were transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable, OR
Continue to serve in the Selected Reserve8/2/1990 – Present 6+ years - + Veteran
-
Status Qualifying Wartime & Peacetime Periods Qualifying Active Duty Dates Minimum Active Duty Service Requirement Veteran
World War II 9/16/1940 – 7/25/1947 90 total days Post World War II 7/26/1947 – 6/26/1950 181 continuous days Korean War 6/27/1950 – 1/31/1955 90 total days Post Korean War 2/1/1955 – 8/4/1964 181 continuous days Vietnam War 8/5/1964 – 5/7/1975
*For Veterans who served in the Republic of Vietnam, the beginning date is 2/28/196190 total days Post Vietnam War 5/8/1975 – 9/7/1980
*The ending date for officers is 10/16/1981181 continuous days 24 Month Rule 9/8/1980 – 8/1/1990 *The beginning date for officers is 10/17/1981 24 continuous months, OR
The full period (at least 181 days) for which you were called or ordered to active dutyGulf War 8/2/1990 – Present 24 continuous months, OR
The full period (at least 90 days) for which you were called or ordered to active duty - + Spouse
-
The spouse of a Veteran can also apply for home loan eligibility under one of the following conditions:
- Unremarried spouse of a Veteran who died while in service or from a service connected disability, or
- Spouse of a service member missing in action or a prisoner of war.
- Surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003 (Note: a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must have applied no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 6, 2003 that are received after December 15, 2004.)
- Surviving Spouses of certain totally disabled veterans whose disability may not have been the cause of death.
- + Other
-
You may also apply for eligibility if you fall into one of the following categories:
- Certain U.S. citizens who served in the armed forces of a government allied with the United States in World War II>
- Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with World War II service, and others
Purchasing a home with a loan requires you to consider the impacts that financial transactions may entail. The VA has procedures in place to address credit score, sufficient income, bankruptcy, foreclosure or short sale, certificate of eligibility and restoration of entitlement.
- Credit Score: The lowest credit score that VA accepts is 580.
- Sufficient Income: VA does not have any limitation on debt to income ratio if it exceeds your residual income by 20 percent or more. You can determine your residual income by calculating the amount that is left over after you provide for your family’s living expenses. Food, clothing, health care and transportation are items that comprise ordinary living expenses.
- Bankruptcy: If you file for Chapter 7, you have a two-year waiting period, but you may reduce it to one year by documenting any extenuating circumstances. For Chapter 13, you must show proof of debt restructuring, a record of making on-time payments for 12 months and approval from the court. Your documentation must show cause for filing for bankruptcy and why it is not likely to happen again. Foreclosures or bankruptcies for seven prior years are disqualifying if you apply for a jumbo or high balance VA loan.
- Foreclosure or Short Sale: The disqualification for jumbo and high balance VA loans applies to foreclosures and short sales as well as bankruptcies. After a two-year wait, you must present a credit report that has a zero balance on any mortgage liens that were part of the foreclosure.
- Certificate of Eligibility (COE): Lenders rely on a COE for proof of your eligibility for a VA loan. Obtaining the document requires verification of your service category and evidence of your eligibility. Click here to find the requirements and an application form.
- Restoration of Entitlement: VA assures you of a financial guaranty from the federal government that promises to pay part of your home mortgage if you default on it. You can request restoration of a previously-used entitlement so that you can buy another home. Click here to find the conditions that affect the amount that you can receive under certain circumstances.
Utah Military Bases
- Hill Air Force Base – Ogden, UT
- Dugway Proving Ground Army Base – Tooele, UT
- Camp W.G. Williams Army National Guard – Bluffdale, UT
