Can I assume a VA loan if I'm not a veteran? (2024)

Can I assume a VA loan if I'm not a veteran?

A VA loan “assumption” is when a borrower takes over an existing mortgage, and it's possible even if the buyer isn't a military service member, veteran or eligible surviving spouse. This type of transaction can benefit both homebuyers and sellers.

Do you need to be a veteran to assume a VA loan?

In addition to the service requirements, lenders will evaluate the borrower's financial information to ensure they can repay the loan. But when assuming a VA loan, the new borrower will not need to meet any military service requirements. With that, non-veterans can assume a VA loan.

Are VA loans assumable by anyone?

You have certain basic rights as a VA loan borrower that you should know about. These include: Assumable Loan. For all VA Loans committed on or after March 1, 1988, you may sell your home to someone who agrees to assume your loan if the loan holder or VA approves the creditworthiness of the purchaser(s).

What is the minimum credit score to assume a VA loan?

The U.S. Department of Veterans Affairs doesn't set a specific VA loan credit score requirement. Lenders, however, can set their own minimum requirements for a VA loan. Most require a score of at least 620, but some go as low as 500.

Can you get a VA home loan if you're not a veteran?

Minimum service required for a VA mortgage

VA home loans are available to active-duty service members, veterans (unless dishonorably discharged), and in some cases, surviving family members. To be eligible, you need to meet one of these service requirements: You've served 181 days of active duty during peacetime.

What are the rules for assuming a VA loan?

Why would a veteran be denied a VA loan?

Lenders must make sure the borrower has established an acceptable credit history. Borrowers must be able to prove their income and have enough money in the bank to cover closing costs associated with the loan such as for an appraisal and homeowner's insurance.

How long is the process to assume a VA loan?

The fastest Williams has seen a loan assumption close is 60 days, but the timeline is usually 60 to 120 days … even longer. In a market like this, Williams said, an assumable VA loan can be enormously beneficial for the buyer ...

Who determines if a loan is assumable?

The VA must approve the loan assumption, and you'll need to meet the VA-approved lender's credit and underwriting requirements. The VA doesn't set a minimum credit score, but lenders can require a certain credit score, commonly 620 or higher.

Do you have to qualify for an assumable loan?

Buyer still needs to qualify for the loan: Unless it's a case of death, you have to have the credit and finances to be eligible for the loan you want to assume.

Can I get a VA home loan with a 480 credit score?

The VA doesn't have a minimum credit score requirement. Instead, lenders can set their own requirements. At Rocket Mortgage, the minimum qualifying credit score is 580. Keep in mind, you can qualify for more favorable terms with a higher score.

Can you get a VA home loan with a 550 credit score?

Key Takeaways. No Minimum Credit Score – The VA loan program does not enforce a minimum credit score, focusing instead on the overall loan profile. Private Lenders' Role – Private lenders will likely have minimum credit score requirements, typically that will range between 580-620, which can affect loan terms.

How many times can you assume a VA loan?

As long as you're still eligible for a VA loan and are able to qualify with a lender, there's no limit to how many of these mortgages you can take out over the course of your life. In fact, it's even possible to have more than one VA loan at the same time in certain circ*mstances.

Who pays closing costs on a VA loan?

Who pays closing costs on a VA loan? The buyer is typically responsible for paying for things like the VA funding fee, loan origination fee and more. However, the seller might be able to contribute; they can pay closing costs up to 4 percent of the total home loan price.

What will make a house fail VA inspection?

Appraisers must note any damage caused by termites, wood-destroying insects, pest infestation, dry rot or any other defects that cause structural issues with the home. The appraiser must look for issues that could make the home less stable and/or put the occupants in harm's way.

What are red flags for VA loan?

Red flags include the presence of radon gas, asbestos or lead-based paint within the home, or properties located in a flood zone, near a sinkhole, or proximity to any type of environmental contamination.

How often are VA loans denied?

How Often Do Underwriters Deny VA Loans? About 15% of VA loan applications get denied, so if your's isn't approved, you're not alone. If you're denied during the automated underwriting stage, you may be able to seek approval through manual underwriting.

What will disqualify you for a VA home loan?

If you've received an other than honorable, bad conduct, or dishonorable discharge, you may not be eligible for VA benefits.

What is the VA approved assumption clause?

Assumption Approval Clause. The instruments evidencing the loan must read substantially as follows: “THIS LOAN IS NOT ASSUMABLE WITHOUT THE APPROVAL OF THE DEPARTMENT OF VETERANS AFFAIRS OR ITS AUTHORIZED AGENT.”

How does the VA verify occupancy?

To satisfy the VA occupancy rule, your attorney or the dependent's legal guardian must certify that the occupancy requirement has been met. If you can meet the requirement via a spouse or dependent, you and your family won't need to worry about residency being an issue while you're on duty.

What happens to VA loan when veteran dies?

In many cases the surviving spouse is the co-borrower on the loan, but even if the surviving spouse isn't included on the loan, they will most likely assume the debt when they take on their loved one's estate. If there are no children or other relatives to claim your estate, it will be sold to repay your VA loan debt.

Why would a loan not be assumable?

Conventional loans are rarely assumable, because the mortgage contract usually contains a due-on-sale clause, which allows the lender to demand the entire remaining loan amount as soon as the property is sold.

Is it hard to get an assumable mortgage?

USDA loans are usually assumable, but require the prior approval of the USDA. They will not grant an approval if the seller is behind or in default on their payments. In order to qualify: You will need a minimum credit score of 580 to 620, depending on individual lender guidelines.

What type of loan is not assumable?

Conventional mortgages are not generally assumable. But in most cases, government-backed loans are. You can usually assume a seller's FHA, VA, or USDA mortgage. For most buyers, an assumable FHA loan would be the top pick, as VA and USDA loans have more stringent requirements.

What is an example of an assumable loan?

For example, in assumable mortgage loans, a buyer can purchase a house from a seller while taking over his mortgage loan under his name. This will free the seller from their debt, and the new homeowner will assume the seller's mortgage loan.