Your first step toward your dream home starts with choosing the right lender. Here at Cadmus Credit Union, we understand that buying a home is one of the most significant decisions of your life. Several mortgage programs are available, each with its features and terms. Whether you are a first-time home buyer or looking to refinance, our team is ready to help you every step of the way.

What is a Home Loan?

This is a type of loan where you borrow money from a lender to buy a property, and as security for the money being repaid, the lender takes title to the property. If you fail to pay the loan on time, the lender can take the house or apartment. There are different types of mortgages: fixed-rate, where payments remain the same, or variable-rate, which can change over time. There are also government-backed mortgages, which help people with certain conditions.

Types of Home Loans Available in Virginia

When looking to buy a home in Virginia, understanding the different types of home loans can help you make an informed decision. Here's a detailed look at the main options available: 

Conventional Loans

The government does not back conventional loans, the most common type of home financing. These loans often require a higher credit score, typically above 620, and a down payment ranging from 3% to 20%. They are ideal for borrowers with a stable job history, good credit, and the ability to make a substantial down payment. Because the government does not insure them, lenders are at more risk, which might be reflected in the loan's interest rate or terms.

FHA Loans

The Federal Housing Administration backs FHA loans to make home-buying more accessible. These loans are perfect for those with lower credit scores (as low as 580) and small down payments (as low as 3.5%). FHA loans are especially beneficial for first-time buyers because of their lenient credit requirements and low down payments. However, borrowers must pay for mortgage insurance, which protects the lender if you default.

VA Loans

VA loans can benefit qualifying veterans, active military personnel, and some of the National Guard and Reserves. The single largest benefit is that no down payment is required. VA borrowers are also not subject to private mortgage insurance. Competitive interest rates and flexible terms make VA loans great value for our military members. Eligibility must be established through the Department of Veterans Affairs.

USDA Rural Development Loans

The USDA loan is unique in that it is designed for homes in rural and some suburban areas, requires no down payment, and has low interest rates. It helps low- and moderate-income families buy, rehabilitate, or improve homes in rural areas. To qualify for a USDA loan, your household income cannot exceed 115% of the area median income and must be located in a USDA-eligible area.

Top Home Loan Providers in Virginia

Looking to buy a home in Virginia? Here's a simple guide to some of the best home loan providers, each offering unique benefits. But first, let's spotlight the standout option.

1. Cadmus Credit Union

Cadmus Credit Union is a great place to get a mortgage in Virginia, especially if you are a first-time home buyer. We offer competitive interest rates for our members, which will help you pay less each month. Cadmus Credit Union has friendly staff who can help you understand how everything works. We have a variety of loan options, including fixed rates. This means your monthly payment will stay the same for the entire loan. This is great for budgeting because you always know how much you spend. Cadmus Credit Union is the place to start if you want a home. 

2. Virginia Financial Bank

Virginia Financial Bank is a great option for those looking for FHA loans. If you need to make a small down payment or have less-than-perfect credit, this bank can help. They offer personal service that is hard to find elsewhere. They will help you navigate the terms and find what works best for your situation.

3. Blue Ridge Lending Services

Blue Ridge Lending Services is a great choice if you need a loan fast and get quality service. They work especially well with VA loans, ideal for veterans and active-duty military personnel. These loans can allow you to make no down payment. If you are a military person or veteran, Blue Ridge Lending Services can help you get a loan with good terms quickly and easily.

4. Coastal Home Finance

Coastal Home Finance is a great choice if you want the lowest interest rates or are considering refinancing. They are known for their good rates and expertise in refinancing. Coastal Home Finance professionals will walk you through the entire refinancing process. They will make it straightforward so you can get the best deal quickly and without hassle.

How to Apply for a Home Loan in Virginia?

Here's a step-by-step guide on how to apply for a home loan in Virginia: 

Check Your Credit Score

Before you apply, it's good to know your credit score. This helps you understand what loan options might be available to you.

Gather Your Documents

To apply, you'll need several documents: your ID, proof of income, tax returns, and bank statements. Having these ready can speed up the process.

Choose the Right Loan

There are different lending options available to you. Depending on your situation, a fixed-rate loan might be best, or maybe an FHA loan if you're a first-time homebuyer.

Fill Out the Application

You can apply online, over the phone, or in person. The application will ask about your income, debts, and the house you want to buy.

Submit Your Application

Once you have completed the application and collected the documents, submit it. The lender will process the application, and you will receive a decision.

Approval and Closing

You will receive money for your home if your personal and financial information is correct and meets the lender's requirements and the type of loan you choose.

Required Documentation and Eligibility Criteria

To apply, you'll need:

  • A government-issued ID (like a driver's license)
  • Proof of income (pay stubs or W-2 forms)
  • Tax returns from the last two years
  • Recent bank statements
  • Details about the property you want to buy

Eligibility criteria include a good credit history, a stable income, and a reasonable amount of debt compared to your income. Additionally, when you get a home loan from us at Cadmus Credit Union, you are required to be a member of our credit union.

Tips for a Smooth Approval Process

To increase the likelihood of approval for a home loan, follow these recommendations:

Improve Your Credit Score

Pay off debts and do not incur new debts during the preparation period. A higher credit score will get you a better loan rate.

Save for a Down Payment

The bigger your down payment, the better. It shows us that you're serious about buying a home.

Keep Your Job

A change of employment may raise a red flag when noted in the application process. A stable job means a stable income, which is crucial for acquiring a loan.

Be Honest

Always be truthful in your application. Any error or omission in the application may delay your loan approval and, in some cases, even prevent one.Description: Virginia offers a range of home loan types, including conventional, FHA, VA, and USDA loans. Discover which one suits your home-buying or refinancing needs.