Are you a service member or Veteran buying your first home? Take steps to get ready and take advantage of your options

Build a nest egg. Find a real estate agent. Gather paperwork. Resolve debt.

These are just a few of things I needed to do before my wife and I could settle on our first home. We knew as military home buyers, we had some built-in advantages — namely, access to the home loan guarantee through the U.S. Department of Veterans Affairs (VA).

We were also lucky to be able to tap into our network of military and Veteran peers, at RallyPoint and in our local community, who’d gone through the process. They provided us with clutch advice on everything from preparing for our home search to getting a home loan.

Don’t get me wrong — the process still mostly stunk. We encountered complications made worse by the pandemic and lost offers to other buyers in what is now a white-hot housing market. My advice is: be patient. Your dream house is out there. Here are a few other things you can do to get ready:

Put away a chunk of change. The more cash you have saved heading into your home search and purchase, the better. Even though VA loans don’t require a down payment, you can opt to make one. A down payment can bolster the strength of your loan application, reduce the VA loan funding fee (if you’re not exempt) and lower the cost of your monthly payment. Tap these funds for costs related to appraisals, inspections, moving, repairs and other items and to start a rainy day fund for emergencies.

Be aware of your credit history. Eliminate surprises later by learning your credit history now. (In the middle of our homebuying process, I discovered a small VA benefits-related debt I needed to resolve before my loan could be processed.) If you’re in the military, financial readiness centers on military installations can access and review your credit histories with you. Veterans and anyone else can request a free credit history every 12 months from each credit reporting company (see https://rly.pt/3hQMBbp). If you have a low credit score, start now to repair it by making monthly payments on time and reducing your debt load.

Plan to use a buyer’s agent. Signing up with a buyer’s real estate agent turned out to be the best single piece of advice we received in our journey to homeownership. These professionals work on your — not the seller’s — behalf. In addition to counseling us to wait until we found the right home in our price range and desired location, she took care of many other details — negotiating the offer, corralling paperwork and making sure we didn’t pay fees in error. She also recommended a mortgage broker who skillfully managed the loan process from start to finish. Ask your military and Veteran peers for agent recommendations and interview several people before signing a contract.

Gather your paperwork early. It’s never too early to collect the paperwork you know you’re going to need, including bank statements, letters of employment from civilian or military entities, pay stubs, two years of tax returns and W-2 statements, and the like. Ask your commanding officer for help expediting military-related records requests. Review VA home loan eligibility rules and consider applying now for a Certificate of Eligibility, which lenders require for VA loans.

Know your benefit options. As noted, unlike with conventional and Federal Housing Administration loans, VA loans don’t require you to come up with a down payment or, for that matter, to pay mortgage insurance. VA loans tend to have lower interest rates and closing costs. You can get a VA home loan at any age and reuse this benefit, even if you’ve had a VA loan foreclosed on. You can even have more than one active VA loan.

VA home loan financing options are as follows:

Native American Veterans can seek a VA loan to buy, build or improve a home on federal trust land through the Native American Direct Loan program.

For other Veterans, service members or family members, VA guarantees a portion of your loan, which helps banks and other lenders provide money at a lower cost toward the purchase or refinancing of your home. In the VA-backed home loan category, there are purchase loans, cash-out refinance loans and interest rate reduction refinance loans.

For those in the National Guard, the VA home loan guarantee was recently opened up to you even if you have a shorter service history, a change estimated to benefit 50,000 more members. Under legislation enacted in early January, eligibility was expanded to National Guard service members and Veterans mobilized to perform full-time duties for 90 collective days, as long as 30 days of service are in a row. The benefit timeframe was also moved back to a service date of Nov. 1, 1955. Other home loan benefits were extended to you if you’re a Veteran, service member or family member in a disaster area.

Shop around. Even if you’re eligible for the VA home loan benefit, you should compare offers from multiple lenders and shop around for the best interest rates, lowest fees and most accommodating customer service. And even though you may be able to qualify for a large home loan, be sure you can handle the mortgage payments. With lockdowns lifting, you want some money left over to enjoy the occasional dinner and vacation and then head back to home sweet home.

Learn more

Get tips on building up your savings from Military Saves: https://militarysaves.org.

Learn how to select a buyer’s agent: https://rly.pt/3hz4e0N

Read Military OneSource’s piece on buying a home off installation: https://rly.pt/3k0NSiX .

Read about the VA home loan benefit expansion to National Guard members and others: https://rly.pt/3wtHq6G .

Review information on the VA funding fee: https://rly.pt/3wyCqO6 .

Prepare to start a COE application: https://rly.pt/3fzeWQt .

Read RallyPoint’s previous coverage of VA’s home loan program: https://rly.pt/3hVOHGW

Call a VA Regional Loan Center at [login to see] to ask questions about COEs, homebuying or underwriting.

Visit VA Home Loans page: https://www.benefits.va.gov/homeloans/index.asp.