Obtaining a VA Loan

The application process for VA financing is
no different from any other type of loan. In
fact, the VA application form is the same as that used for HUD/FHA and conventional loans. The mortgage company verifies the applicant's income and assets, and obtains a credit report to see that your obligations are being paid on time. If all is well and the appraised value of the property is enough to cover the loan needed, the company, in most instances, can then close the loan under VA's automatic procedure. Only about 10 percent of VA loan applications have to be submitted to a VA office for approval before closing.

Because the loan amount may not exceed the CRV (certificate of reasonable value), one of the first steps in getting a VA loan is to request an appraisal. The CRV is based on an appraiser's estimate of the value of the property to be purchased. Your mortgage company can request a VA appraisal by completing VA Form 26-1805, Request for Determination of Reasonable Value. If the property was recently appraised under the HUD procedure, under certain limited circumstances, the HUD conditional commitment can be converted to a VA CRV.

It is important to recognize that while the VA appraisal estimates the value of the property, it is not an inspection and does not guarantee that the house is free of defects. Home buyers are encouraged to inspect the property themselves, or to hire a reputable inspection firm to help in this area. VA guarantees the loan, not the condition of the property.