The Department of Veterans Affairs (VA) offers loans to active-duty military personnel, veterans, and their spouses. These VA loans can help veterans buy homes without a down payment. Additionally, VA loans come with low interest rates. While VA loans can be beneficial, one must understand exactly what to expect when applying for such loans. So, one should understand the terms and carefully avoid mistakes that can interfere with the loan approval process.

1. Ignoring the credit score
The minimum credit score requirements for VA loans vary from one lender to another. Nonetheless, if one’s credit score is incredibly low, then their VA loan application may be denied. Even if one doesn’t get a rejection from the lender, they may be charged a higher mortgage rate, which would mean more expensive monthly loan installments. For this reason, one needs to always check their credit score before applying for a VA loan. In fact, if possible, one should try to boost the score to improve their chances of getting the loan approved.

2. Not exploring all options
Many national banks and other lenders are authorized to offer VA loans. Each lender offers attractive rates and special features to lure as many borrowers as possible. As there are so many options to consider, one must not rush to apply for the first loan offer they find. Instead, one must shop around for better lenders and offers until they find one that meets their specific requirements. For example, if one has a poor credit score and finds two lenders, then one can consider going for the lender with more lenient credit score requirements, even if they quote slightly higher interest rates. One must see what kind of lender or interest rate is best for them and get quotes from multiple lenders before making a decision.

3. Overlooking loan eligibility criteria
One may believe they are eligible for a VA loan because they have served the armed forces in the past. While the service record matters, one should also consider the length of service and discharge conditions. These factors not only determine loan eligibility but also if one can receive a variety of associated benefits. First, veterans seeking a VA loan need to secure their own Certificate of Eligibility—a document that lets lenders know that the holder of the certificate is eligible for VA loans. There is no workaround for this, so not securing this document can delay the loan approval process.

4. Skipping home inspection
One of the most common types of VA loans is a home purchase loan. While the VA does not ask for inspections to qualify for a loan, skipping this step can be a mistake. It would increase the risk of having to make costly repairs in the future to fix damages in the home. So, one should schedule a complete home inspection to potentially identify issues. Then, one should calculate the upfront costs, which would include the cost of repairs, replacements, and maintenance. Then, one can decide on the loan amount and apply for a VA loan.