949.640.3102

calmythsThe VA loan program is an amazing benefit for our veterans in California. Surprisingly, there are thousands of veterans in California that haven’t used the program because of some longstanding misconceptions about VA loans. Here is the truth behind 4 of the most popular myths regarding the VA loan program…


Myth #1: You need to have perfect credit for a VA loan.

Any credit limit (minimum FICO score) that a lender gives you for a VA loan is a lender imposed limit. The VA does not have specific credit requirements for loans so every lender is different. Most lenders will look for a credit score of at least 620, but some will go even lower, with some lenders going as low at 580. If the first California VA lender you try doesn’t accept your loan request it may be worth looking to see if you can find a California VA lender that will.

Myth #2: VA loans take longer to close than other loans


Many think that the VA loan process is a slow and cumbersome process. However, it has become much faster and a much more streamlined process. According to Ellie Mae, VA and conventional loans both on average close in about 44 days. But for a California lender who specializes in VA loan, even 44 days sounds long. Under 30 days is possible in most circumstances.  Also, VA loans are much more likely to close compared to conventional loans.


Myth #3: VA loans are much riskier

Since no down payment is needed for a VA loan many think it is a riskier loan. Even with no down payment, VA loans have the lowest foreclosure rate compared to any other conventional program. Other requirements like “residual income” help to solidify the safety of the VA program.

Myth #4: VA loans can only be used one time

This might be one of the biggest misconceptions about the VA loan program. There are many veterans that think this is only a one time perk or their eligibility expires after a certain period of time, but this is not true at all. VA loans are a lifelong benefit that can be used multiple times. Eligible veterans have a basic entitlement that represents their ability to use the program. As they pay off their first VA loan, that entitlement restores and are then able to use the VA program again. It is even possible to have more than one VA loan at a time. For example, in high cost counties like Orange County, CA, there is a “bonus entitlement”. The bonus entitlement allows a California Veteran to purchase another home with no down payment. For someone looking to see what their options are while still owning a home with VA financing a true California VA Loan Expert should be consulted.

Authored by Tim Storm, a California VA Loan Officer specializing in VA Loans. MLO 223456. – Please contact my office at the Home Point Financial. My direct line is 949-640-3102. I will prepare custom VA loan scenarios which will be matched up to your financial goals, both long and short term. I also prepare a Video Explanation of your scenarios so that you are able to fully understand the numbers BEFORE you have started the loan process.