Veterans First Mortgage Review

    Veterans First Mortgage Review: Competitive Rates For Veteran Borrowers

    If you're looking for government-backed loans to finance your home, Veterans First Mortgage can help you out. This company has long been a go-to lender for veterans looking for a zero-down home loan, with competitive rates and solid refinance options.

    But how does this company compare to other lenders? Keep reading our review to find out more about the kinds of loans offered by Veterans First Mortgage, how you can apply for a loan with this company, and whether it's a good option for your home loan.

    What To Look For In Mortgage Lenders

    Low rates will always be a major priority when deciding on a lender, but there are other things you should consider before applying. Before we do a review of Veterans First Mortgage, here are five factors you should take into account when choosing a mortgage lender.

    Loan Types

    Different companies will offer different loan types and products – each has its own budgetary and credit score requirements. There are also loan types with additional qualifications, such as VA, FHA, and USDA loans.

    Some lenders also offer renovation loans or refinancing. Find out which loan type is best suited to your financial capabilities and homeownership goals before you decide on a lender.

    Application

    Ask companies how long the average application process takes after a borrower has submitted all the requirements. In some situations, mortgage applications can take months.

    Some companies have an online application process. If you want to expedite your application or complete it from home, this may be a huge plus for you.

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    Interest Rate

    The riskier it is to lend money to a borrower, the higher the interest rates that lenders will potentially charge. Here are some factors typically considered by companies when fixing rates:

    • Credit History: A more established credit history can lower one's mortgage interest rate, as it reassures lenders of a borrower's track record for repaying on time.
    • Credit Score: A higher credit score will result in lower rates.
    • Employment: Your type of employment affects your income and ability to repay, so it's factored in your risk assessment.
    • Loan Term: A shorter loan term will have higher monthly payments. However, this also lowers your offered rate as the lender will be taking on risk for a shorter period.
    • Loan to Value Ratio: The higher the percentage of your loan amount compared to the property's value, the higher your interest rate.

    These are just a few of the factors that companies look into before offering you mortgage rates. Ask a real estate agent to learn more about the documents and information companies need when computing risk and interest.

    Keep in mind that the type of loan you get will also impact your rates. For example, a VA loan rate is typically lower than a conventional mortgage loan rate. VA loans' rates change daily according to market conditions, so check regularly to see the rate for your desired VA loan type.

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    To lower your interest, you can ask mortgage lenders if they offer discount points. Each point is usually worth 1% of the mortgage value and reduces interest by 0.25%. Consider the affordability of buying points right away, then compare it to the financial impact of a lower rate over the loan's term.

    Borrowers should also consider terms for rate locks. A rate lock will allow you to lock in a fixed interest rate during the period between the loan offer and mortgage closing. This will remain in place as long as the borrower closes within the agreed time.

    If the rate lock expires before closing, lenders might require a borrower to pay for an extension – whether or not the delay was the borrower's fault. This is a potential additional expense you'll need to consider before you decide on a lender.

    Customer Service

    A mortgage is a financial commitment that will last for years. During this time, you will need a lender with reliable customer service. Consider how swiftly a company acts on complaints and questions and check how many channels you can contact them through. 

    The more channels available, the easier it will be to get assistance. This is particularly important for active members deployed overseas, as they may not be able to contact a loan officer during regular business hours.

    Additional Fees

    Borrowers should consider the financial burden of additional costs, such as underwriting costs, application fees, and closing costs. Negotiate as many of these as you can for a lower total expense.

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    Veterans First Mortgage Review

    Veterans First is a company based in Salt Lake City. Founded in 1985 under the original name Freedom Mortgage Corporation, Veterans First became part of the Wintrust Mortgage family in early 2017. It is a VA mortgage and VA refinance lender.

    Veterans First Mortgage has loan centers in Utah and California. They are licensed to offer VA, FHA, and USDA mortgage loans in all fifty states, including the District of Columbia.

    Veterans First Mortgage Loan Types and Services

    Veterans First Mortgage offers the following home loan options.

    Department of Veterans Affairs Loans (VA Loans)

    VA loans can only be granted to current or former service members of the U.S. Armed Forces, reserves, the National Guard, or their partners. As long as you meet VA loan eligibility criteria, you can secure a VA home loan with zero downpayment and no mortgage insurance premiums required.

    The VA loan benefit comes with another plus to military members: the VA option clause. Also known as the VA escape clause, this clause is applied in cases where the home's appraised value is lower than the agreed purchase price.

    This is important because the VA won't approve a VA home loan that's higher than the house's appraised value. If there's a mismatch between these values, the clause allows VA loan borrowers to walk away from the contract without forfeiting earnest money. Because of this protection, VA loans are a solid choice for protecting the interest of military borrowers.

    USDA Home Loans

    Secured by the U.S. Department of Agriculture (USDA), these zero-down loans can be used to purchase properties in eligible rural locations. Aside from geographic eligibility, the USDA also has income eligibility requirements.

    FHA Home Loans

    These government loans are backed by the Federal Housing Administration (FHA). Interested home buyers are required to place a 3.5% minimum down payment and have a credit score of at least 620 to qualify for these loans.

    FHA and VA IRRRL Refinance

    A refinance allows borrowers to get lower rates and monthly payments, pay their mortgage more quickly, or cash out home equity.

    IRRRL, the interest rate reduction refinance loan, is a VA refinance that reduces the current rate and mortgage payment for an existing VA loan. While you can't cash out your equity with this type of refinance, it has a simpler process – you won't be asked to submit a new Certificate of Eligibility, and the property doesn’t have to be reappraised. In some cases, you don't even need to have your credit and income reverified.

    These are the only mortgage loan products and services offered by Veterans First Mortgage. If you're looking for a home equity loan, conventional loan, or home equity lines of credit (HELOCs), you'll have to go to a different lender.

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    Application Process

    Borrowers can apply for Veterans First mortgage loans online. Here's how you can complete your home loan application through their mobile-friendly site.

    Get A Certificate of Eligibility (COE)

    Veteran applicants, active military service members, and their partners will need a COE before they apply for a VA loan. The good news is that Veterans First is an accredited VA lender, so they can get your COE for you from the VA online portal.

    Send Requirements For Mortgage Pre-Approval

    Go on the Veterans First site and indicate the purpose of your loan, whether it’s for a home purchase or to refinance existing home loans. You'll be asked to enter some basic information about yourself, such as your phone number, email address, and ZIP code. Once you've filled this form, loan officers will help you understand the different loan types you can avail of.

    During the application process, applicants will be required to disclose certain information and documents. This allows Veterans First to verify your income and assets, as well as review your credit score and history. These are some of the documents you may be required to submit:

    • Tax returns over the last two years
    • Bank statements
    • Statements for any existing credit cards
    • Recent paycheck stubs

    These requirements can be submitted online through the Veterans First site, but applicants can opt to mail their documents instead. Once you've completed your application, you can also lock in your Veterans First mortgage rate.

    Appraisal

    Before a loan is sent for approval, Veterans First will determine the value of your home through a home appraisal.

    Underwriting and Loan Approval

    When all information and documents have been verified, Veterans First will send the loan for approval, then clear it for closing. Borrowers can choose a convenient date and time for their mortgage closing.

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    Mortgage Rates

    You should always compare lenders' fees with offered mortgage rates – some lenders may offer a lower rate, but charge you a higher upfront fee. Others will allow you to reduce mortgage rates by buying discount points.

    Unfortunately, Veterans First doesn't provide rate information for its loans on its site. While it does offer information on fees for VA loans (e.g. the VA loan funding fee), you'll need to call Veterans First or inquire through its contact form. After that, a Veterans First loan officer will get in touch with you.

    While VA loans usually have more favorable interest rates compared to other loan types, it can be difficult for homebuyers to compare options and compute the total cost of their home mortgage because of the lack of transparent, easily accessible information. This can make it challenging to determine if a Veterans First mortgage loan will fit your current budget.

    Customer Service

    While Veterans First doesn’t have any Better Business Bureau (BBB) reviews, many customers reported a great experience with the lender. 1,011 reviews have given Veterans First an average rating of 4.8 out of 5 stars on Trustpilot. 

    Reviews praised the responsiveness and competency of staff members. Customers also reported low rates and fast service.

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    Will You Be Eligible For A Veterans First Mortgage Loan?

    Your application can be affected by three factors: the minimum down payment you can afford, your credit score, and your debt-to-income ratio. Here's how they'll be assessed:

    Minimum Down Payment

    While conventional lenders require you to make a 20% minimum down payment for a mortgage, FHA loans require only a 3.5% down. VA and USDA loans are available even with zero down payment. 

    VA loan limits were also removed for active service members and veterans with full VA loan entitlement, starting Jan. 1, 2020. Loan limits, however, will still apply to applicants who had active VA loans before the limit removal and applicants who have defaulted on a VA loan.

    The limits set the highest amount of money that the VA can guarantee without requiring a down payment from applicants. The VA itself does not cap the amount of money that an applicant can borrow, but limits may vary from state to state.

    Want to find out how much you can borrow before placing money for a down payment? Type in your city and state to find out the loan limits for veterans or active members in your area.

    Credit Score

    Lenders often offer the best rates to applicants with a credit score that's at least 740 or higher. Currently, Veterans First requires a minimum credit score of 660 for a VA loan and 620 for USDA and FHA loans. 

    Note that having this credit score is not a guarantee your loan will be approved, as Veterans First guidelines are subject to change.

    Debt-To-Income Ratio (DTI)

    Your DTI is the ratio of your debt compared to your income. This shows a lender your capacity to afford the loan’s monthly payments.

    Lenders prefer a DTI of 36% or less. However, depending on the lender, FHA, VA, and USDA loans may be approved even with a higher DTI.

    To compute your DTI, add all your monthly debt obligations, such as bills for credit cards and student loans. Then, add your potential monthly payment for your mortgage. Divide the total by your monthly pre-tax income. Multiply the result by 100 – this percentage is your DTI.

    You can also compute your DTI with our handy calculator:

    Pros

    • Veterans First provides low or zero-down loan options from the VA, FHA, and USDA.
    • It has decades of experience helping active and veteran borrowers.

    Cons

    • Veterans First doesn't offer renovation mortgages, home equity loans, HELOCs, or conventional home mortgages.
    • Credit guidelines can change, so a previously eligible score may not be eligible in the future.
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    The Bottom Line

    Veterans First is an affordable lender for active-service and veteran borrowers, allowing applicants to finance their homes with little to no down payment. It also provides an easy online application experience. However, the lender doesn't publish its mortgage rates, and it offers limited loan types.

    Veterans First is a solid choice for those who want to reduce their down payment. But because its credit requirements may change, the company may not be the best option for those with low credit scores.

    If you're not sure about getting a Veterans First loan, contact Wesley Mortgage, LLC. We make sure our clients are fully informed about different mortgage types and their best loan options. Let us help you find the best loan type for your budget!

    If you don't want to get a loan from Veterans First, you can also read our other reviews to find the right lender for you.

    Written By Ed Wallace
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