What is a Colorado VA Loan?
VA loans are provided by private lenders that work in conjunction with the U.S. Department of Veterans Affairs. Because the VA guarantees to reimburse the lender if the borrower defaults, lenders are incentivized to offer good mortgage rates.
Military service members and veterans with less-than-perfect credit appreciate that VA loans offer manageable credit requirements and lower interest rates than conventional loans, helping them achieve their dreams of homeownership without high monthly payments.
Benefits of VA Loans in Colorado Springs
VA loans are an excellent way to afford property in Colorado Springs. Some of the many VA loan benefits include:
- Zero down payment requirement
- No private mortgage insurance (PMI)
- Competitive interest rates
- No prepayment penalties
- Flexible credit requirements
- Refinance loans
- Reusable VA benefit
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Get a quoteVA Loan Eligibility in Colorado Springs
To qualify for VA loans, active-duty military members must secure a Certificate of Eligibility from the Department of Veterans Affairs. This shows that they meet the minimum service requirements set by the federal government.
You must have served for 90 consecutive days in wartime or 181 consecutive days in peacetime. If you are an Army Reserve or National Guard member, you must have served for at least 6 years. There may be exceptions if you received an early discharge due to a service-related disability.
You can only receive a VA loan for a primary residence, not a vacation home or investment property. Our VA loan specialists will ensure that you meet all requirements before applying, which streamlines your application process.
VA Loan Property Requirements
To secure VA loans, Colorado Springs properties must meet the minimum standards set by the VA. Firstly, the mortgaged property has to be your principal residence.
The VA specifies that homes must be safe, sound, and sanitary. Generally, this means it has running water, a secure foundation, working doors and windows, and a sewer system. It also should not have lead pipes, asbestos, or a termite infestation.
How to Apply for a VA Loan in Colorado Springs?
Arnaiz Mortgage streamlines the VA loan process so that you can quickly get the keys to your dream home. Here’s what you can expect when you work with our experienced loan officers.
- Secure Your Certificate of Eligibility (COE): Military personnel must prove that they meet the active service requirement, and veterans must also prove they had an honorable discharge. For surviving military spouses, you must not have remarried, and your spouse must have passed away due to a service-connected disability.
- Get Pre-Approved: Qualified borrowers who have a preapproval letter can enjoy greater negotiating power. You can get preapproved for a VA loan online by providing your COE and financial documentation.
- Go House Hunting: Work with a local realtor who is familiar with the Colorado Springs market, such as where military families typically settle. You might choose to buy near Fort Carson or enjoy the beautiful scenery of Cheyenne Mountain.
- Home Appraisal and VA Underwriting: An appraiser will confirm that the purchase price matches the home’s value and that the property meets VA standards. Your loan application then goes to the underwriting team, which verifies your information and approves the loan amount.
- Loan Closing: Once your loan is approved, you will schedule your closing date. Your loan officer will go over the loan terms, and you will pay closing costs. Finally, you receive the keys to your brand new home.
VA Loan Limits in Colorado Springs
First-time borrowers are not subject to a loan limit when using the VA home loan program. Qualification is instead based on the borrower’s credit score and their ability to afford the mortgage payments. This is called full entitlement.
Likewise, if you pay off a previous VA loan, you regain full entitlement and can take out any loan amount for which you qualify.
If you have an existing VA loan, then you are subject to the standard VA loan limit, which is $806,500 in El Paso County.
VA Loan Interest Rates in Colorado Springs
Right now, VA loan rates in Colorado Springs are significantly lower than conventional loans, which are in the high 6% range. Your rate will vary based on your credit score, loan amount, debt-to-income ratio, and overall market trends.
As a local VA loan lender, we strive to offer the best rates available based on your financial profile. We have local knowledge that allows us to more accurately estimate your purchasing power, ensuring you can enjoy affordable loan payments. Contact us today for a free, no obligation quote.
Types of VA Loans Available
The VA program offers a variety of loan products to meet all your needs. We’ll help you determine the best option based on your financial goals and borrower profile.
- VA Purchase Loan: Choose between fixed-rate and adjustable-rate mortgages in 30-year or 15-year terms based on your specific needs.
- VA Interest Rate Reduction Refinance Loan (IRRRL): If you have an existing mortgage with the VA, you can secure even better rates through this fast and simple streamlined refinancing option.
- VA Cash-Out Refinance: Service members can utilize their home’s equity to consolidate debt or make a down payment on a second home through a cash-out refinance.
- VA Jumbo Loan: While first-time VA home loans do not have a loan limit, those with an existing VA loan may want a home worth more than $806,500. Well-qualified borrowers can go above loan limits through a jumbo mortgage.
VA Funding Fee and Closing Costs
The VA funding fee is a one-time fee that helps to fund the program and reduce the cost for US taxpayers. How much you pay depends on whether this is your first time using your benefit and if you provide a down payment.
| Down Payment Amount | Funding Fee Amount | |
| First Use | Less than 5% | 2.15% |
| 5% or more | 1.5% | |
| 10% or more | 1.25% | |
| Subsequent Use | Less than 5% | 3.3% |
| 5% or more | 1.5% | |
| 10% or more | 1.25% |
For cash-out refinances, the funding fee is 2.15% for the first loan and 3.3% for subsequent loans. If you have a service-connected disability, you can apply to have the funding fee waived.
Like with other home loans, you will also need to pay closing costs, which cover the expenses of opening and underwriting a loan. These range from 1% to 6% of the total loan amount and include things like underwriting fees, loan servicing fees, attorney costs, and escrow for home insurance and property taxes.
As putting money down can significantly reduce your upfront costs, our team can help you find down payment assistance programs that cover these expenses. The Colorado Housing and Finance Authority offers several options, and we can also explore more specialized programs that meet your specific needs.
Why Choose Arnaiz Mortgage for VA Loans in Colorado Springs
Arnaiz Mortgage is proud to help active-duty military and veterans purchase their dream homes through Colorado Springs VA loans. We are a VA-approved lender with years of experience helping veterans.
Our local officers are highly familiar with the Colorado Springs home market, allowing us to provide advice tailored to your specific financial goals and the local market conditions.
You’ll receive one-on-one support throughout the VA home loan process. We’ll help you decide between our different mortgage products, such as comparing conventional loans and VA home loans, and ensure your loan application is prepared properly.
Thanks to our in-house underwriting team, we can get you approved and funded faster than our competitors. We offer competitive rates on our loan products and are here for you throughout the life of your loan, from first application to refinancing.
