How To Get a VA Loan Pre-approval

What Is a VA Loan Pre-Approval?

A VA loan pre-approval means you’ve been pre-approved for a mortgage through the Department of Veterans Affairs before you start seriously house hunting. Getting pre-approved is one of the first steps for many homebuyers and can give you an advantage in today’s competitive market.

Know How Much You Can Borrow

With a VA pre-approval, you’ll know exactly how much the VA will guarantee for your loan so you can focus on homes in your price range. The VA uses information like your income, assets, debts, and credit score to determine your maximum loan amount. This helps ensure you don’t end up with a mortgage payment you can’t actually afford.


Make a Stronger Offer

Sellers often prefer buyers with a pre-approval letter because it shows you’re serious and ready to move forward. This can make your offer more appealing compared to buyers who haven’t been pre-approved yet. In competitive housing markets where homes get multiple offers, a pre-approval may even give you an edge.

Speed Up the Buying Process

Much of the paperwork and underwriting for your mortgage is done during the pre-approval process. This means once you have an accepted offer on a house, the final loan approval moves more quickly. Without a pre-approval, all that work has to be done after you find a home – which can delay closing and add stress to an already complicated process.


Benefits of Getting Pre-Approved for a VA Loan

Getting pre-approved for a VA home loan before you start house hunting comes with some major perks.

1. Have an edge over other buyers

Sellers and real estate agents prefer pre-approved buyers. They know you’re serious and ready to move forward quickly with a purchase. Your offer will seem more attractive since there’s little chance of your financing falling through. This can give you a competitive advantage, especially in tight housing markets.


2. Know your budget

A pre-approval will tell you exactly how much you can borrow for your mortgage. This helps you determine a realistic price range for your home search. Without pre-approval, you could end up falling in love with properties that you ultimately can’t afford.

3. Lock in your rate

Interest rates change frequently. By getting pre-approved, you’ll lock in the rate you qualify for at that time. If rates go up later on, you’re protected. And if rates drop, you can usually get the lower rate as long as you close on your home purchase within a certain window of time after pre-approval.


4. Fewer surprises

The pre-approval process helps ensure there are no unexpected issues with your credit or income that could derail your VA loan approval. It’s better to find and resolve any potential problems upfront before you make an offer on a house. This way you can avoid unwanted surprises that could foil your home buying plans.

Getting pre-approved for your VA home loan is well worth the effort. In many ways, it puts you in the driver’s seat and helps provide peace of mind that you’re in a position to achieve your goal of home ownership. Start the pre-approval process today so you can start searching for your new place with confidence.


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VA Loan Pre-Approval Process Step-by-Step

The first step to buying a home with a VA loan is getting pre-approved. Pre-approval means a lender has reviewed your credit and financials and has agreed in writing to lend you up to a certain amount for a mortgage.


With a pre-approval letter in hand, you can start searching for homes with confidence, knowing you have already cleared the financing hurdle.

1. Check your eligibility

The VA home loan program is available to qualifying veterans, active-duty service members, reservists, National Guard members, and some surviving spouses. You must have enough time left on your GI Bill entitlement to cover the cost of the home you want to buy.


2. Gather your documents

To get pre-approved, you’ll need to provide documents to verify your identity, income, work history, assets, and liabilities. This typically includes pay stubs, tax returns, bank statements, retirement account statements, information on any outstanding debts, and a copy of your Certificate of Eligibility (COE).

3. Check your credit

Your credit score and credit report will be reviewed by the lender to determine your eligibility and see if you qualify for the best rates. So check your own credit reports and scores ahead of time to ensure there are no errors and take steps to improve your credit if needed.


4. Find a VA-approved lender

You can search online for VA-approved lenders in your area. Major banks, credit unions, and mortgage companies offer VA home loans. Compare rates and fees to find a lender you want to work with.

5. Apply for pre-approval

Submit your application and documentation to your chosen lender. They will verify the information to determine how much you can borrow based on your income, assets, and the VA’s lending limits in your county. If approved, you’ll receive a pre-approval letter stating the loan amount.


With your pre-approval secured, you can start searching for your perfect home. Be sure to stay in close contact with your lender during the home shopping process to keep them up to date on any changes.

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Documents Needed for VA Loan Pre-Approval

To get pre-approved for a VA home loan, you’ll need to provide certain documentation to verify your eligibility and income.

Gathering these documents ahead of time will help speed up the pre-approval process.


1. Proof of Service

The VA requires evidence of your military service to determine your eligibility for a VA home loan. This typically includes a copy of your DD214 discharge paperwork. If you’re still currently serving, you’ll need to provide a statement of service signed by your commander.

2. Income Verification

To qualify for a mortgage, you’ll need to provide pay stubs, tax returns, bank statements and other paperwork to verify your income. The VA recommends providing documents from the past 2 years. If you’re self-employed or have additional income sources, provide business tax returns, 1099s and profit and loss statements as well.


3. Credit Report

Your credit report and score play an important role in determining your eligibility for a VA home loan and the terms you may be offered. Request a free credit report to check for any errors before applying for pre-approval. High credit card balances and missed or late payments can negatively impact your score and eligibility.

4. Asset Statements

The VA also considers your assets, like savings accounts, retirement funds, and investments, to determine how much you can put toward a down payment and closing costs. Provide recent statements for all accounts for the past 2-3 months. Large deposits, especially those over 50% of your income, will need to be documented as well to verify the source of funds.


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In summary, start compiling copies of your discharge papers, pay stubs, tax returns, bank statements, credit report, and any other documents that verify your income, assets, and credit history. Having these papers ready to provide to your VA lender will speed up the pre-approval process and help ensure you get the best terms possible for your VA home loan.


VA Loan Pre-Approval FAQs

Here are some common questions about VA loan pre-approval:

1. How does pre-approval work?

Pre-approval involves providing documents that verify your income, employment, and financial assets. The lender will review everything to determine your borrowing power and issue a pre-approval letter stating the maximum mortgage amount you qualify for. This letter is usually good for 60 to 90 days as you search for homes. When you find a house you want to buy, the lender will order an appraisal to officially approve the final loan.


2. Why is pre-approval important?

Sellers prefer buyers who have been pre-approved because it shows you’re serious and in a good financial position. As a pre-approved buyer, you can make a strong offer with confidence. Pre-approval also locks in your interest rate for the period of the pre-approval. Rates may go up later, so locking in sooner rather than later can save you money.

3. What do I need for pre-approval?

You’ll need documents like pay stubs, tax returns, bank statements, and information on your assets and debts. The lender will want to see your income sources and that your debt-to-income ratio is within acceptable limits. Be prepared to provide contact information for your employer to verify your employment. The pre-approval process includes a credit check, so check your credit report for any errors before applying.


4. How long does pre-approval take?

For most people, VA loan pre-approval can take a few days to a few weeks depending on how quickly you provide the necessary documents. The more prepared you are, the faster the process will move. Pre-approval needs to be issued before you can make an offer on a house, so start the pre-approval process as soon as you begin your home search.

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