The VA Loan Process for Military Living in Omaha Nebraska

If you're stationed in Omaha, NE, and are considering purchasing a home, you might be interested in using your VA loan benefits. I will be providing a basic overview  to help your understanding of VA loan benefits, specifically tailored to those stationed in Omaha. We'll explore what a VA loan is, its benefits, eligibility criteria, and how to navigate the local real estate market.

What is a VA Loan?

The VA loan is a mortgage loan program established by the United States Department of Veterans Affairs (VA) to help veterans, active-duty service members, and certain members of the National Guard and Reserves purchase homes. The VA doesn't directly lend money; instead, it guarantees a portion of the loan, allowing lenders to offer more favorable terms.

Key Benefits of a VA Loan

1. No Down Payment

One of the most significant benefits of a VA loan is the ability to purchase a home with zero down payment. This can be particularly beneficial for military families who may not have substantial savings.

2. No Private Mortgage Insurance (PMI)

Unlike conventional loans,  which will charge you PMI if you have less thatn 20% equity in your home, the VA backed loans do not require private mortgage insurance, which can save you hundreds of dollars per month.

3. Competitive Interest Rates

VA loans typically offer lower interest rates compared to conventional loans, making your monthly mortgage payments more affordable.

4. Easier Qualification Requirements

Because the VA guarantees a portion of the loan, lenders are more likely to offer loans to individuals with lower credit scores and less stringent income requirements.

5. Assumable Loans

VA loans are assumable, meaning that if you sell your home, the buyer can take over your loan under the same terms, provided they meet the VA's eligibility requirements. This is especially important with current high interest rates.

Eligibility for a VA Loan

To qualify for a VA loan, you must meet at least one of the following criteria:

• Active Duty Service Members: Currently serving in the military and have completed at least 90 consecutive days of active service.
• Veterans: Have served in the military and have been honorably discharged.
• National Guard and Reserves Members: Have completed at least six years of service or 90 days of active service during wartime.
• Surviving Spouses: Unmarried surviving spouses of veterans who died in service or from a service-related disability.

Navigating the Omaha Real Estate Market

1. Understanding the Local Market

Omaha's real estate market has been growing steadily, making it an attractive place for military families. It's important to understand the market trends, including average home prices, neighborhood amenities, and school districts.

• Average Home Prices: As of 2024, the median home price in Omaha is approximately $325,000. Prices can vary significantly based on location, home size, and other factors.
• Neighborhood Amenities: Omaha offers a variety of neighborhoods, each with its own unique amenities. Popular areas for military families include Bellevue, Papillion, and La Vista, which are known for their proximity to Offutt Air Force Base, good schools, and family-friendly communities.
• School Districts: Quality education is a priority for many military families. Omaha has several highly-rated school districts, including Millard Public Schools, Elkhorn Public Schools, and Papillion-La Vista Community Schools. Please go to GreatSchools.com to look for more information about schools.

2. Working with a Military-Friendly Realtor

Choosing a Realtor who understands the unique needs of military families can make the home-buying process smoother. A military-friendly Realtor will be familiar with VA loans, relocation challenges, and the local market. Not only am I a Military Relocation Specialist (MRP), but I also served in the Air Force for 25+ years!

3. VA Loan Limits in Omaha

As of 2024, the VA loan limit for Omaha is $726,200. This means you can purchase a home up to this amount without needing a down payment, provided you have full entitlement.

The VA Loan Process

1. Prequalification and Preapproval

• Prequalification: This is an initial step where you provide basic information to a lender to get an estimate of how much you can borrow.
• Preapproval: A more detailed process where the lender reviews your credit history, income, and other financial factors to give you a formal loan approval amount.

2. Finding a Home

Once you're preapproved, you can start your home search. Work with your Realtor to identify properties that meet your needs and budget.  I have a FREE Buyer's Guide to help you navigate through the process.

3. Making an Offer

When you find the right home, your realtor will help you make a competitive offer. If the offer is accepted, you'll move on to the next steps in the loan process.

4. Home Inspection and Appraisal

• Home Inspection: A thorough inspection of the property to identify any potential issues.
• Appraisal: The VA requires an appraisal to ensure the home's value matches the loan amount. The appraisal also ensures the home meets the VA's minimum property requirements.

5. Loan Approval and Closing

• Loan Approval: After the inspection and appraisal, your lender will finalize your loan approval.
• Closing: The final step where you sign the loan documents and take ownership of your new home.

Specific Considerations for Those Stationed in Omaha

1. Proximity to Offutt Air Force Base

For those stationed at Offutt Air Force Base, proximity to the base can be a crucial factor in your home search. Areas like Bellevue and Papillion offer short commutes, making them popular choices.

2. Temporary Duty Assignments and Deployments

Military life often involves temporary duty assignments (TDY) and deployments. It's important to consider the potential for these situations when choosing a home. Look for properties that offer rental income potential if you need to relocate temporarily.

3. Understanding the Market's Seasonality

The real estate market can fluctuate based on the time of year. Spring and summer are typically the busiest seasons, with more homes on the market. However, buying during the off-season (fall and winter) can sometimes lead to better deals.

Financial Considerations

1. Understanding Your Basic Allowance for Housing (BAH)

Your Basic Allowance for Housing (BAH) can significantly impact your home-buying budget. BAH rates vary based on your rank, location, and dependency status. Use your BAH to help determine how much home you can afford.

2. Additional Costs to Consider

• Closing Costs: Typically range from 2% to 5% of the loan amount. Some of these costs may be covered by the seller or rolled into your loan.
• Property Taxes: Omaha has a property tax rate of approximately 2.1%, which is higher than the national average. Factor this into your monthly budget.
• Homeowners Insurance: Required for all mortgage loans and can vary based on the home's value and location.

Tips for a Successful Home Purchase

1. Get Your Finances in Order

• Check Your Credit Score: Ensure your credit report is accurate and work on improving your score if needed.
• Budget Wisely: Create a budget that includes all homeownership costs, not just the mortgage payment.

2. Use VA Resources

• VA Loan Centers: Take advantage of VA loan centers and resources that offer guidance and support throughout the home-buying process.
• Education and Counseling: The VA offers homebuyer education and financial counseling services to help you make informed decisions.

3. Stay Flexible

Military life can be unpredictable. Stay flexible and be prepared for potential changes in your housing needs. Having a plan for renting out your property if you need to relocate can provide peace of mind.

Conclusion

Purchasing a home using a VA loan can be a game-changer for military families stationed in Omaha, NE. The benefits of no down payment, competitive interest rates, and easier qualification requirements make it an attractive option. By understanding the local real estate market, working with a military-friendly Realtor, and leveraging your VA loan benefits, you can find the perfect home for you and your family. Whether you're looking for proximity to Offutt Air Force Base, an urban downtown feel, or a rural area with acerage, Omaha has something to offer. Happy house hunting!