The VA Mortgage Loan is intended for the veterans, active military personnel, and spouses of those who passed away during active duty or as a result of military related disability. This loan provides many beneficial services to military personnel and qualifying family members that may help ease the process of a home purchase. The following is a detailed list of having a VA mortgage loan.
Benefits of Having VA Mortgage Loan
Benefits of VA Home Loans
1. No Down Payment
Traditional loans can at times require a down payment of up to 20% for those who want to purchase a home, making it seemingly impossible to do so. With a VA loan, you will have no down payment, making the possibility of home ownership that much easier; VA loans are one of the last home loans that have absolutely no down payment.
2. No Mortgage Insurance
When purchasing a home, it is often the case that you are required to purchase Private Mortgage Insurance (PMI), which can lead to additional monthly fees. With a VA Mortgage Loan, banks won’t require you to purchase PMI, as the government backs the VA loan.
3. The VA Guarantee
Despite the fact that this loan was created as a federal program, it is not typically funded by the government, but rather by private lenders. These lenders are encouraged to do so by the assurance of the Department of Veterans Affairs guaranty, which ensures the safety of their loans and any losses regarding them. This provides assurance not only to lenders but to those who will receive a loan, that they will be covered and taken care of in an exceptional way, rather than with many typical loans out there.
4. Competitive Interest Rates
Often banks need to weight the risks that they are taking in loaning money out, and when there are higher risks and no backings on a loan, the interest rates are less competitive on your home loan. With a VA loan, there is a guaranteed backing that assures lenders of a low risk, generally assuring a more competitive rate than with other loans.
5. No Pre-Payment Penalty
With typical mortgage loans, there is a concession between the lender and borrower where the amount of money which the latter is allowed to pay off at a time is regulated. This can be an issue when attempting to refinance or sell one’s home, and they are stuck with penalty charges and more payments due. With a VA loan, there is NO payment penalty, ensuring you the ability to sell, refinance, or pay larger sums toward your mortgage without being hit with more charges and financial burden.
6. Easier to Qualify
Many typical loans can be extremely strict with their qualifications, causing many prospective homebuyers to be unable to own their own home. Due to the government backing and DVA guarantee discussed in point 3, banks and lenders are far more assured of their money’s safety, allowing them to be more flexible and less severe with their qualifications.
Drew Mortgage Associates is a leading mortgage company in MA that helps first time home buyers find the right loan to fit their financial and situational needs. With the VA home loan programs, veterans and service men/woman are given the help and assistance they need to find the best home loans for their situation. To find out if you qualify for a VA home loan and for more information, visit https://www.drewmortgage.com/no-money-down-loans/