VA Loans Help Military Homebuyers
The best feature of a VA loan is that a down payment is not required. This is ideal for those of you who have promising careers in the military, but have yet to save for a down payment.
Other benefits to taking out a VA loan:
• Competitive 30- and 15-year interest rates. Various adjustable loan options are also offered.
• Less-than-perfect credit is accepted, without a penalty to the rate.
• Sellers or other interested parties may contribute funds toward closing costs.
• The maximum loan amount is $417,000. This amount rises considerably in certain designated “high-cost” geographic areas such as Washington, DC.
•When it’s time to refinance, certain veterans qualify for the VA Streamline, which reduces the amount of paperwork required (in some cases, the appraisal). It also offers an interest rate reduction (.50%)
•The funding fee is waived if you have a service-connected disability. This can save you thousands so if you are considered disabled, be sure to take advantage of this savings.
• You can apply for temporary mortgage relief payments if called up for duty.
Pros and Cons:
Con: There is a one-time VA Funding Fee. This fee varies depending on the type of transaction, amount of the down payment, if any, and your military category. The fee typically runs about 2% of the purchase price, but can be rolled into your loan so you don’t have to pay it out of pocket.
Pro: A VA Streamline can be done with no out-of-pocket money. All costs can be included in the new loan, or the new loan can be set at an interest rate high enough for the lender to pay the costs.
Overall, VA loans are a GREAT loan option for those who have served our country. Thank you for your service to our country!