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VA Loans
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What is a VA loan?
The VA loan program is an aspect of the Servicemen’s Readjustment Act of 1944, or the GI Bill, as it is commonly known. This bill was meant to provide assistance to veterans who had served in defense of the nation. Part of this bill included assistance in purchasing a home. Today, VA loans are offered by a variety of financial institutions, including:
Banks
Private lenders
Other loan companies
Mortgage Companies
Who qualifies for a VA loan?
Today, there are over 25.5 million individuals who qualify for some sort of VA Loan. In order to qualify for a VA Loan, you must qualify for at least one of the following categories.
You have served, full-time, for at least 2 years in the armed forces.
Or, you have served in the National Guard, or reserves, for a period of 6 years (this timeline is reduced if you are called to active duty).
Why get a VA loan?
There are many benefits of going with a VA loan, rather than a conventional loan. Here are some of major reasons that qualifying individuals should opt for a VA loan:
No down payment is required
Borrowers do not need private mortgage insurance
Interest rates are generally lower than conventional loans
Less stringent credit stipulations
Low ceilings on closing costs
Continuous foreclosure avoidance support (once you have your home)
VA loan restrictions
A VA loan guarantees a portion of the home loan for eligible borrowers, typically covering up to 25% of the loan amount. While there is no official loan limit for VA loans, lenders may set their own limits based on conforming loan limits, which vary by county.
There are also fees for using a VA loan. For example, a first-time user of a VA loan, without a down payment, is levied a 2.15% fee. This amount is lowered to 1.25% if they pay a 10% down payment, but will rise to 3.3% for the second time that you utilize a VA loan.
Call our experts today, to see if you quality for a VA loan!
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Are you dreaming of owning your first home? Buying a home can be a big step, but with the right guidance and resources, it can be a rewarding experience. Our First Time Homebuyers Guide provides valuable information on everything from understanding your budget to navigating the home-buying process. Learn about different loan options, including FHA loans, and find helpful tips to make your homeownership journey a success. Download the guide here!
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