One of the most obtainable home loan programs available in the market today is a Veterans Affairs (VA) loan. A VA loan is the only home loan program, next to a USDA loan, that requires no down payment to purchase a house. That in itself already makes it such a coveted arrangement.
As the name implies, this is open only to military members and their eligible spouses and, due to its 0% down payment and other agreeable terms and features, the qualifications can be a bit stringent compared to other traditional loans.
Advantages of Getting a VA Mortgage Loan
The Veterans Affairs, by itself, does not extend VA loans; VA-approved mortgage lenders do. It is important to note, however, that both the VA and mortgage lenders have certain eligibility requirements. Once these requirements are met, an eligible applicant can already choose from any of the home loan programs guaranteed by VA.
Compared to other home loan programs or even conventional loans, the VA has the following advantages:
- 0% Down Payment
This is one of the many reasons why VA loans are one of the most sought-after programs in the industry. Consider this the federal government’s way of thanking the brave men and women who fight for the country. Coming up with a down payment often hinders most from pursuing their dreams of owning a home. To make it easier for war veterans to have a house to come home to, the VA decided to eliminate the need for a down payment on home mortgages.
- No Mortgage Insurance
Most home loans require mortgage insurances, especially those that have very lenient qualification requirements. Lenders need a mortgage insurance to protect themselves in case a borrower defaults, but in VA home loan, there is no need for a mortgage insurance, Instead, the borrower will pay a minimal funding fee which can be paid at closing or can be rolled into the loan amount.
- Lower Rates, Better Terms
Compared to other home loans, VA loans offer better terms and more competitive interest rates. Qualified applicants will never find anything as great as VA home loans.
What a VA Home Loan Allows You to Do
Eligible applicants can actually choose from any of the programs offered by VA. Would-be homeowners usually use a VA loan to purchase homes, which is actually the primary purpose of the program.
However, those who already have existing VA loans can apply for a refinance should they want to save money by applying for another that offers lower rates and more favorable terms. This is what’s commonly called a VA Interest Rate Reduction Refinance Loan or IRRRL. There is no need for additional underwriting requirements when getting an IRRRL, making it another convenient option for veterans.
Since 1944, the VA has helped over 20 million military families take advantage of the VA home loan programs. You could be one of them. To find out more about loans for veterans, feel free to get in touch with a VA-approved mortgage lender near you.