If you have taken advantage of the benefits that come along with a VA loan or other financial resources available to military families and you’ve finally purchased your dream space, it is important to make sure you are getting the most out of your homeownership.
To prepare for what’s to come, there are a few things that you should know as a new homeowner.
From streamlined refinancing to getting another VA loan, there is a lot that you should know after you buy a home. You’ve already taken care of the entire buying process, now it is time to make sure you are ready to handle homeownership successfully.
If you want to better understand what’s to come as a new homeowner, keep these things in mind and prepare yourself for the journey that is ahead.
1. All About Streamlined Refinancing
If you are a qualified VA borrower, then you have access to some of the most powerful refinancing options that are available on the market. VA streamline refinanced loans are easy and able to be completed quickly because the homeowner will be refinancing from one VA loan to another, simplifying the process.
This will allow you to refinance an existing VA loan to a new one with a lower interest rate or convert it to an adjustable fixed rate. This is why it is called a streamlined refinancing option because it requires way less paperwork and is typically faster than traditional refinancing.
Many advantages come along with refinancing, including little to no out-of-pocket costs and no VA appraisal.
If you meet the requirements for a VA IRRRL (interest rate reduction refinance loan), such as having financed property with a VA loan and being able to prove that you lived there – you may be able to utilize this form of refinancing. Keep in mind, this is only open to veterans who have taken out a VA loan, any other loans are not a part of this.
If you are a veteran with non-VA loans and want to refinance to a VA loan, look for a VA cash-out refinancing option to help you out.
2. Getting a Second VA Loan
Whether you are in search of a new home with more bedrooms, a bigger yard, or just more living space in general, over time your family may need to move out of your current home and into a larger, more comfortable space. This is commonly referred to as moving up, but it can cause many obstacles to get in your way as you try to gather enough money for a traditional down payment to make ends meet.
It is important to remember that many benefits are a part of the VA loan program, one of them giving you the ability to purchase with no money down. In other words, you can bypass a common barrier to homeownership since there is no limit to how many times you can use a VA loan – making it possible to get a second one. If your financial status isn’t the best and you think a second loan will help you more than hurt you, then this is a great option to help your family move into a more spacious home.
3. Importance of Homeowners Insurance
If you are a new homeowner, it is valuable to understand the importance of homeowners insurance and how it can protect your living space as well as your family.
With homeowner’s insurance, you will pay an insurance company a certain amount of money monthly to protect you from potential hardship that would be caused by losses. If there were a house fire, a natural disaster, or other circumstances, you would want to make sure your home is covered and secure with the right insurance on your side. Homeowner’s insurance will cover the structure of your home, your personal belongings, your personal liability, and any other living expenses that may occur as a result of damage to your home.
Technically speaking, you are not required to take out homeowners insurance, but to get a mortgage loan it will be required. Plus, it makes sense to take an extra step to protect your home and make your homeownership worthwhile.
Don’t forget to consider your insurance policy costs, your mortgage payment, and any other expenses that will be required for you to pay, to make sure you will be financially stable in your new home.
4. Keep an Eye on Your Bank Statement
When you apply for your mortgage, you will need to provide a lot of documentation. This will help lenders verify your employment, income, and assets to approve you for a VA loan.
One of the documents that will need to be provided will be your bank statement, giving lenders a glimpse into your spending habits and financial decisions. Keep in mind, this will be sent to an underwriter who will make sure you meet the lender and VA requirements, to ensure you will make your payments on time.
To make sure your bank statement looks appropriate make sure that you avoid overdrafts or a negative balance, recurring payments, untraceable deposits, and undisclosed debts. All of these factors will affect your approval for a VA loan and financial security.
5. Minimum Property Requirements to Note
The Department of Veterans Affairs wants to be sure that service members are buying quality, functioning, and up to code homes for their families, which is why they set these guidelines to help homeowners make the right purchase decision.
You will want to make sure you have easy access to the home, that there is no lead paint in your home, that the space passes the pest inspection, there are no heating or cooling issues, and that there are safe sanitary water conditions.
Make sure your home is up to date and up to par with the VA standards, to make sure the home you’re in is approved and covered with ease.
6. Making Your Home More Energy-Efficient
As a homeowner, it is important to consider all of your family’s energy consumption and how it adds up over time. If you are looking for ways to reduce the amount of energy you’re using and lower your energy costs, you may want to consider looking into alternative options to make your home more efficient.
The government supports the switch to becoming more green, providing many benefits to homeowners at the state and local levels. Plus, the Energy Efficient Mortgage or EEM can now be added to your VA loan, providing financial assistance to help you with any energy improvements that you want to make to your home.
While it will take a lot to make the switch towards being more green, it can help you save money on utility bills and decrease the amount of energy you are using in years to come. If you are in your forever home, this is a decision you should consider, especially if saving money and helping the planet are important to you.
What to Know as a VA Homeowner
As a new homeowner, it is important to keep these things in mind as you utilize your VA loans and the financial resources that are available to you. To make the most out of your homeownership and become more financially stable, it is important to keep these things in mind as you start the journey ahead.
By understanding the importance of homeowners insurance, all about streamline refinancing, how to get a VA loan twice, and what is required of the property you’re moving into – you will be better prepared as a homeowner.
After successfully moving through the buying process, it is time to take it slow and become the best homeowner you can be, making sure you are making all of the right moves along the way.