Obtaining a VA Loan
To Obtain a VA Loan:
Most banks, savings and loan associations, and certain approved mortgage companies, may "automatically" approve most home loans if they find income and credit OK and veterans and property are eligible. This means they can close the loan before sending it to the VA. This procedure saves time and its use is encouraged whenever possible.
- Veteran must establish his or her eligibility for a VA loan. A certificate of eligibility may be obtained from any VA Regional Office. In North Carolina the VA Regional Office is located in Room 769, Federal Building, 251 North Main St., Winston Salem. Phone (919) 631-5591.
Walk in Procedure: Veteran brings discharge or separation papers, DD 214, WW II veterans bring discharge, other veterans bring separation papers to VA Regional Office, and complete WA Form 26-1880, the application for the certificate. VA eligibility clerk reviews application form and discharge or separation paper(s) and then issues certificate of eligibility, VA Form 26-8320.
Mail Procedure: Veteran writes or telephones VA Regional Office and requests an application for the eligibility certificate. He completes application form and mails it with discharge for WW II service or separation paper(s) for other periods of service to the VA Regional Office. Eligibility clerk reviews service papers and applications and returns the discharge or separation paper(s) with certificate of eligibility to veteran by mail.
- Veteran selects home or discusses purchase with seller or selling broker and signs a purchase contract with a condition the agreement is subject to the availability of a VA loan.
- Veteran completes loan application when lender is selected. If the initial application does not reflect sufficient income or acceptable credit, the lender may decline to process the application. Otherwise the lender will proceed to develop all credit information and request VA to appraise and establish a reasonable value for the property. VA assigns appraisal to a designated fee appraiser who appraises the property and submits a report to VA. If the condition of the property is acceptable VA issues a certificate of reasonable value establishing the maximum amount of loan available of the property.
- If the certificate of reasonable value is acceptable to all parties and the lender develops the veteran's income is sufficient and the he or she is a good credit risk, the loan may be approved. Most participating lenders close VA homes loans "automatically" without first submitting application to a VA for review.
- Once the loan has been approved, a loan closing date, acceptable to the buyer and seller is established. The veteran and spouse (if married) are required to attend the loan closing and sign the note and mortgage and other related papers. The lender will explain the loan terms and requirements. Additionally, the veteran will be instructed about where and how to make the monthly loan payments. The seller signs the deed to the veteran and spouse which is sent to the county court clerk for recording. When the deed is copied on the clerk's records, it will be delivered to the veteran. The lender keeps a copy of the hazard insurance policy and will be given instructions about what to do in the event of a loss. When the lender reports the loan closing to VA, the certificate of eligibility is annotated to reflect the use of entitlement and returned to the veteran.
VA Form 26-105