A Guide for the Future: A blog about applying for Chapter 53, special loans for disabled veterans.
The VA has instituted a new type of loan program that functions similarly to an interest bearing savings account. The good news is the loan can be used by any veteran or service member who is totally disabled and cannot work. The bad news is that this program is not very well known, and you need to apply for it if you want to take advantage of it.
What is a Chapter 53 Loan?
A Chapter 53 loan is made so that a veteran or service member with a service connected disability rating of at least 30% can borrow up to three times their entitlement without having to put up any collateral. Their entitlement is based on the county in which they plan to live, and the current VA rate of interest. To find out what your entitlement would be you can use the VA’s website here.
This loan is designed as a way for veterans who are unable to work due to their disabilities, but want to purchase a home, and do not have sufficient funds saved up to do so. It functions very similarly to an interest-bearing savings account, where the loan amount will decrease each year as long as there are no withdrawals from the account other than the annual payments
There is a section of the VA loan guarantee program that few veterans know about. It’s a special provision of the law that allows disabled veterans to work with private lenders and get home loans with no money down. The program is guaranteed by the VA, so it offers many benefits over traditional mortgages. These include no mortgage insurance, no prepayment penalties, and low interest rates.
This blog is here to guide you through the process of applying for a Chapter 53 loan. We’ll tell you what you need to do, and make sure that you know everything about this important benefit for disabled veterans.
I have been working on my Chapter 53 application for almost two months now. It has been a long and sometimes confusing process, but I think all of the hard work is about to pay off. My application is finally finished and ready to be submitted.
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When I started this process, I was worried that it would be difficult to get approved. The loans are meant for veterans with severe permanent disabilities, but mine aren’t so severe or permanent. Some days I can function well enough to complete tasks like housework and shopping, but other days I struggle just to make it through the day.
I have learned a few things during this process that I hope will help veterans like me who are thinking about applying for Chapter 53 benefits. Here are the most important things you need to know: You don’t need perfect disability ratings in order to be approved for Chapter 53 loans; they just have to be permanent and either total or severe. If you make too much money, you won’t qualify for a loan; make sure your income stays low enough so you don’t become ineligible. You can use any extra income you receive to pay off the Chapter 53 loan; it doesn’t count as income when determining your eligibility.
The Department of Veterans Affairs has announced that a new Chapter 53 program will be available to disabled veterans beginning on August 1, 2010. This program will allow disabled veterans with a rating of at least 80 percent to borrow up to $200,000 in order to buy, build or improve a home or farm. The interest rate can be as low as 4 percent and the loans are guaranteed by the VA.
The VA program is intended to assist disabled veterans who are having difficulty getting conventional loans because they cannot make the required down payment. The primary benefit of this program is that it allows a 100 percent loan with no money down. This means that an eligible veteran can borrow up to $200,000 without making a single down payment.
The loans have a maximum term of 30 years and the interest rates will be based on the Treasury rate plus 1/2 of one percent. For example, if the Treasury rate is 5 percent, then the interest rate would be 5 -1/2 percent plus 1/2 of one percent which would make your interest rate 6 percent.
The loans are guaranteed by the VA so they are not required to meet the same underwriting requirements as conventional loans. There is no mortgage insurance requirement and there is no minimum credit score requirement.
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If you are a disabled veteran who has been denied for Chapter 53, the Department of Veterans Affairs (VA) will not provide a reason for the denial. The VA does not have to provide any reason. However, it is my opinion that most denials are due to the use of outdated or improper medical documentation and the lack of correct and complete financial information on your part. You must submit evidence to support your financial need and ability to repay the loan.
After reviewing hundreds of Chapter 53 denials, I have found that the following information is usually missing:
* Your most recent bank statements
* Your most recent pay check stubs
* Your most recent vehicle registration documents
* Your most recent tax returns
Recently, I’ve been getting a lot of questions from disabled veterans who want to know how to apply for Chapter 53. While it’s not a difficult process, there’s a lot of paperwork involved, so I thought I would create a blog to help people through the process. Hopefully this step by step guide will help you with your own application.
First, you need to gather all the necessary documents:
* Certificate of Eligibility (COE) – The easiest way to get this is to fill out the VA Form 26-8320. Once you do that, send it in and they’ll send you your COE in the mail.
* Military Service Documents – This includes things like your DD-214, discharge certificate, medical records, etc. You can find more information about these documents on the Veteran Affairs website (http://www.va.gov). Make sure you have copies of them all before applying!
* Financial Information – You’ll need two years worth of W-2s or 1099s, tax returns (for yourself and any co-borrowers), pay stubs from your current job(s) that show year-to-date earnings (if applicable), and any other documents that show proof of income such as Social Security
I am a veteran. I was honorably discharged in 2013 after serving in the army for almost 4 years. After my seperation from the army, I went back to school and graduated with an associates in General studies and a Bachelors of Science in Human Resource Management. I am now currently working on my Masters of Science in Human Resource Management.
I was also diagnosed with PTSD after returning from Afghanistan and have been battling it ever since. As a result, I am now attending therapy sessions and take medication to cope with my condition. The medication helps me get through the day but I have found that I have lost some of my mental capabilities as a result.
I never had any issues with memory or focus before taking the medications but now it has become a major issue. Because of this, I am finding it difficult to maintain good grades at school and I find that it is even more difficult for me to do work at my current job (where I work as the Head of HR).