by Maurie Backman | April 19, 2021
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U.S. veterans are eager to jump on the home-buying bandwagon.
Given the fact that we're still in the midst of a pandemic and the U.S. economy is still in a pretty shaky state, you'd think buyers would be shying away from purchasing homes. But not so. The housing market has been booming since January, and buyers are still eager to get a piece of the action.
That sentiment extends to U.S. veterans as well. In fact, one-third of veterans are planning to purchase a home this year, according to Veterans United Home Loans' 2021 Veteran Homebuyer Report.
But buying in today's market is easier said than done. Here's some advice for veterans to increase their chances of success.
One thing U.S. veterans have going for them is that they're eligible for VA loans. These loans let people buy a home with no money down. But while there's no specific minimum credit score needed to qualify for a VA loan, each lender sets its own requirements, so the higher your score as an applicant, the greater your chances are of getting approved.
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If your credit could use some work, make a point to pay all incoming bills on time and, if possible, pay down a chunk of any existing credit card debt you have. You should also check your credit reports for errors in case there are mistakes working against you (for example, a debt listed as delinquent that's already been resolved).
Not all VA lenders are created equal, and you may find that one lender offers a more competitive interest rate on a mortgage than another. That's why it pays to shop around for a VA loan. Contact at least five or six mortgage lenders and see what offers you get back in return before making your decision.
In a normal housing market, you'd approach the home search process by creating a wish list and only making offers on homes that check all the right boxes. But this isn't a normal housing market. Buyer demand is huge right now, and inventory is extremely limited. As such, you'll need to go into the process with a flexible mindset -- that you may not get a home that checks every single box on your list.
Of course, it's OK to establish deal-breakers -- home features or issues you just can't work around. For example, if you're married with two children and need a four-bedroom home, you shouldn't compromise and buy a three-bedroom you know won't suit your family from the start. But you may need to compromise on that updated kitchen you were hoping for, or the already-finished basement you wanted to use as a playroom.
The fact that so many veterans wish to buy homes this year is encouraging, but if you're part of that group, you'll need to gear up for an arduous search. At the same time, be sure to put yourself in the strongest position to qualify for a mortgage so if you do find a home you want to buy, you won't struggle to get approved.
Chances are, interest rates won't stay put at multi-decade lows for much longer. That's why taking action today is crucial, whether you're wanting to refinance and cut your mortgage payment or you're ready to pull the trigger on a new home purchase.
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