The intention of the VA loan program is to supply home financing to eligible veterans in places where private financing is not always available. Private lenders like mortgage companies and banks provide VA Home Loans while VA offers policies and guidance to services so they provide solutions to borrowers. VA loans are for primary residences only, can’t be used to buy vacation homes and the like, and are designed for properties ready to be moved into.
Who is Eligible for a VA Loan?
Members of the military and veterans are eligible to apply, same as spouses of service personnel who died on active duty or were disabled while serving,
Why military personnel should get a VA loan
- Zero down payments required even with bankruptcy: This is this main benefit for a VA loan. A down payment is not required and you can also Get VA Mortgage Lenders for Bad Credit with the right mortgage brokers assisting you. Mortgage programs require 3.5 percent down payment but with a VA loan, you buy quickly instead of saving for a down payment.
- Utilize your benefits as many times as you want: The benefit isn’t a onetime deal and you can use repeatedly by paying off your current mortgage and when you move to a bigger home use your benefits again on the new home.
- Spouses enjoy too: with the benefits, you rest easy knowing your spouses won’t be homeless if anything happens to you while on active duty.
- Lower rates: the rates are lower than conventional loans by 0.3%. VA loans also have one of the lowest foreclosure rates of any loan type, reducing more risk for lenders.
- You can get VA loans from local lenders: The benefit comes from private establishments after a guarantee from the VA that the loan will be paid back even when the service personnel is unable to make payments.
- You can buy, use home equity or refinance: you do more than buying homes with your VA benefits, like refinance existing mortgage even if it’s not a VA loan. Military personnel with VA loan can reduce their rate without appraisal or bank statements.
- No Prepayment penalty: Make extra payments at your leisure and save more money on interest over the duration of the loan. For example, you could structure your loan to remove as little as $100 monthly and deduct thousands of dollars off the balance.
- VA Loans are transferable: You can transfer the VA loan to another home buyer if the person is also eligible for a VA loan. This is a great bonus when selling your home in a rising mortgage rate system.