How long does it take to close a VA loan? If you’re considering funding your next home purchase with a VA loan, it’s smart to have the answer to this question handy. After all, government-backed loan programs have a bit of a reputation. Many people mistakenly believe that buying a home with this type of loan or selling to someone who is using one will lead to headaches, delays, and extra stress. Once you understand that closing on a VA loan won’t be a marathon event, you might find that it’s an excellent option for your situation.
How Long Does It Take to Close a VA Loan?
A time-tested loan program established by the U.S. Department of Veterans Affairs (VA), the VA loan program is designed to help service members, veterans, and other eligible borrowers become homeowners. Individuals who serve earn a home loan guaranty benefit that enables them to apply for a VA loan. Thanks to that guaranty, lenders are able to relax the requirements for qualifying and offer exceptionally good terms, including 100 percent financing, competitive interest rates, limited closing costs, no requirement of private mortgage insurance, no prepayment penalties, and support for those who find themselves struggling to pay their mortgage after their purchase.
With so many advantages, it’s no wonder that individuals who have earned this benefit choose to finance their home purchase with a VA loan. However, the question remains: How long does it take to close a VA loan?
Closing a VA Loan
There are a few persistent myths about closing a VA loan that you may encounter during your journey to homeownership. For example, some whisper that transactions using VA loans are more likely to fall through. In truth, 74.3 percent of VA loans for purchases close. In comparison, 74.1 percent of all mortgages close. The numbers clearly indicate that VA loans are actually (slightly) more likely to successfully close than the average loan. How long does it take for a VA loan to close? As of June 2019, the average VA loan closed in 48 days, according to a report from loan software company Ellie Mae.
Comparing Closing Times
When it comes to closing time, how does the VA loan compare to other common loan types? The Mortgage Reports reviewed the stats provided by Ellie Mae, and found it was a tight race to the closing table. In June 2019, the average mortgage loan closed in 45 days. For conventional loans, the average dropped to 44 days. Meanwhile, the numbers for a FHA loan held steady at 45 days. Although the VA loan did take the longest at an average of 48 days, it’s clear that average closing times are almost neck and neck for most home loans.
Things That Can Delay Closing
An average provides an estimate, but your unique circumstances will dictate how long it takes your loan to close. For example, if your financial situation is more complex, then you should expect the process to take a bit longer. What else might delay a closing? The Balance notes that a low appraisal, mistakes on the buyer’s credit report, missing information, the need for updated financial documents, changes in the marital status of either the buyer or seller, and the entrance of any liens of judgments against either the buyer or seller can all trigger delays. What can you do to avoid delays? While some issues are beyond your control, staying in touch with your lender and responding quickly to any requests for additional information can help you avoid problems and keep your closing on track.
At PrimeLending: Manhattan, Kansas, we understand that the prospect of securing a mortgage tends to raise a lot of questions. After all, buying a home isn’t something you do every day. That’s why we strive to make the process as simple and transparent as possible. Our loan experts don’t want to match you with any loan product; they want to match you with the right loan product for your needs. We will talk with you to discover your housing goals and your circumstances and provide friendly, accessible service as we guide you through the mortgage process. Contact us today to get started.