VA MORTGAGE LOANS
Veterans, military members and their spouses have one of the most affordable homebuying tools at their disposal: the VA mortgage loan.
Offered only to current and former members of the U.S. Armed Services, these loans come with serious perks when compared to other types of mortgages. If you’re a military member or veteran looking to buy a home, then read on to learn more about these valuable loans or reach out to Victoria Krueger at Premier Nationwide Lending of Goose Creek mortgage company today.
WHAT ARE VA MORTGAGE LOANS AND WHO CAN USE THEM?
A VA mortgage is a home loan that is backed by the U.S. Department of Veterans Affairs, which manages government services and benefits for America’s military members. These loans are only available to current and former members of the Army, Navy, Air Force, Coast Guard, Marine Corps, National Guard or reserves who meet the following service requirements:
- 90 consecutive days of active service during a time of war OR
- 181 consecutive days of active service during a time of peace OR
- At least 6 years in the National Guard or Reserves
In some cases, spouses of military members may also be eligible to use a VA mortgage loan if their loved one died in the line of duty or due to a service-related injury. VA loans are not available to civilians or extended family of military members.
A VA mortgage is a home loan that is backed by the U.S. Department of Veterans Affairs, which manages government services and benefits for America’s military members. These loans are only available to current and former members of the Army, Navy, Air Force, Coast Guard, Marine Corps, National Guard or reserves who meet the following service requirements:
- 90 consecutive days of active service during a time of war OR
- 181 consecutive days of active service during a time of peace OR
- At least 6 years in the National Guard or Reserves
In some cases, spouses of military members may also be eligible to use a VA mortgage loan if their loved one died in the line of duty or due to a service-related injury. VA loans are not available to civilians or extended family of military members.
BENEFITS OF USING A VA MORTGAGE LOAN
VA loans are hugely beneficial to those who can qualify for them. For one, they require no down payment whatsoever. This significantly lowers the up-front costs of homebuying and may even allow military members to buy a home sooner than expected.
On top of this, VA loans also don’t require costly mortgage insurance, and they come with capped closing costs. When compared to other types of mortgage loans available, this can save military homebuyers significantly up-front and over the life of the loan.
Finally, VA loans typically come with lower interest rates than other mortgage options, meaning a lower monthly payment and less interest paid over time.
Benefits of VA loans include:
- No down payments
- No private mortgage insurance
- Lower interest rates
- Limited closing costs
The VA loan benefit does not expire. Military members and veterans can use it multiple times as needed.
DRAWBACKS OF VA MORTGAGE LOANS
The disadvantages of VA mortgage loans are sparse, but there are a few factors you’ll want to consider before applying for one. First, most lenders require at least a 620 credit score to qualify for a VA loan. This tends to be higher than other types of mortgage loans out there.
Additionally, VA loans also come with a funding fee of 2.15 percent of the total loan balance. In many cases, mortgage lenders will let you roll this fee into your loan and pay it down with your monthly payments.
Perhaps the biggest drawback of VA loans is that not all service members are eligible. In order to be approved for a VA mortgage, you must meet the very specific service guidelines set forth by the Department of Veterans Affairs.
In summary, the disadvantages of VA loans are:
- Up-front funding fee
- Usually require at least a 620 credit score
- Require set Armed Service lengths
- Cannot be used to purchase income-earning properties
ARE YOU ELIGIBLE FOR A VA LOAN?
If you’re a veteran, current military member or the spouse of one, a VA mortgage loan may be able to help with your home purchase. Contact Victoria Krueger at our Goose Creek mortgage office, and we’ll walk you through your options. Ready to get started or being your home search? We’ll get you prequalified today.