Va Loan Program

Written by Patricia Skinner
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The VA loan program came into being in 1944 to help veterans coming back from WWII compete in the property credit market. Since then, the VA has developed a comprehensive loan program to help prospective home owners who have spent time in the military own their own home. Even if you've been through tough times financially, and haven't been able to get accepted for any other type of loan program, if you are eligible for a VA loan program, you stand a good chance of having your application accepted because of the VA's policy of making things easy for vets.

Since it started in 1944 the VA loan program has helped millions of veterans own their own home. How does the VA loan program work? It presently provides a limited guaranty against loss to a mortgagee (a current maximum of $36,000 or up to $50,750 for certain loans over $144,000) on the part of the lender.

Loans Are Backed By The VA

So VA guaranteed loans are made by private lenders, but approved by the VA themselves, and backed by the VA. Because the VA does not guaranty the loan 100 percent, the lenders also share in the risk of loss in the event of foreclosure on the property. For the lender to complain to the VA for non payment of the loan, the borrower must have missed three consecutive loan payments.

If this happens, the VA will contact the borrower, assess the situation, and offer the lender counseling. The counseling service always attempts to salvage the situation, as the VA have a strict policy of trying to help veterans save their homes from foreclosure. In other words, the VA always have the best interests of veterans at heart.

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