VA Home Loans are designed to help veterans, active-duty personnel, reservists, National Guard members, and some surviving spouses to purchase a home. While provided by private lenders like banks and mortgage companies, these loans are partially guaranteed by the VA, which allows lenders to provide more favorable terms.
Conventional loans may have lower advertised rates but also require credit scores of 720 and above to qualify for these rates. VA loans, in comparison, have government backing, which means banks can assume less risk and possibly even price a loan lower than a conventional bank rate.
Other benefits to a VA Loan are as follows:
*LOWER CREDIT SCORES OK: The VA won’t deny a loan based only on a low credit score, and most lenders don’t tier interest rates according to scores. Rather, the VA will look at the previous 12 months of credit history. You do need to be cautious if you’ve had a tax lien, bankruptcy, or collections situation, but even then, it is worth calling a licensed mortgage broker who specializes in VA loans, like those here at Patriot Home Mortgage- Pacific Group, to see what we can do for you in your situation. We may also be able to help put you on a one year track to qualification.
*NO DOWN PAYMENT: The VA home mortgage is a zero down payment loan. In comparison to a conventional loan, this can save upwards of 20%. There are, however, funding fees involved. To find out more about these, read here. Closing costs are comparable to those of conventional loans.
*EASY RE-FINANCE: If rates drop, the VA program’s Streamline Refinance program will allow a re-finance without re-qualification.
*DISABILITIES CONSIDERED: If you have a service-related disability, you may qualify for funding fees to be waived, further reducing closing costs.
*NO MORTGAGE INSURANCE PREMIUMS
*ABILITY TO PRE-PAY WITHOUT PENALTY
*VA ASSISTANCE IN WARRANTY COOPERATION: If your home was inspected by the VA during construction, the VA can give you cooperation to make sure the builder cooperates with the terms of his or her offered warranty.
*HARDSHIP ASSISTANCE: The VA may offer assistance to veteran borrowers in default due to temporary financial difficulty.
If you would like to discuss more benefits of the VA Loan, compare it to a Conventional loan rate, or see if you qualify, get in touch with one of our licensed and professional VA Loan Specialists today.
Home ownership can be a reward for your years of service to your country, and we would be honored to help make it happen!