The United States has many mortgage loan options to encourage home ownership. Each of these mortgage loan options is created to fit different needs and different financial situations. The most common mortgage loans are the conventional loan, the first time homeowner?s loan, and the veteran?s assistance loan. The VA home loan is specifically for veterans and is a great option for veterans looking to purchase their own home.
What are VA home loan eligibility requirements?
There are very specific VA home loan eligibility requirements. To qualify for a VA loan, one must have served 181 days during peacetime, 90 days during war time, or six years in the Reserves or National Guard. The spouse of a service member who was killed in the line of duty may also qualify. To find out if you qualify for these VA home loans eligibility requirements, you can work with a VA loan provider. The loan provider will take in all of your information. If you meet these VA loan requirements and pre qualify for veterans home loan, you can start the home buying process.
What if you are approved for multiple loans?
The mortgage decision process really gets tricky when you are eligible for multiple loans. It can be difficult to decide which loan is better for your financial situation. However, you will find that there are both benefits of VA loans vs conventional, as well as benefits of VA loan closing costs. When you are choosing between different loans, specifically pay attention to the closing costs, interest rates, and down payment requirements. Each loan program has different requirements for these out of pocket costs and this can be information that you need to make an informed decision.
What does the VA loan offer?
The VA loan has many benefits over both the conventional and FHA loans. For example, VA mortgage rates are currently as much as 50 basis points lower than those available for conventional mortgage loans. Additionally, VA loans do not require any down payment upon closing. When you are closing on a house with a conventional mortgage, you can be required to bring as much as 20% to the closing table. Finally, VA loans do not require mortgage insurance and allow for 100% financing.
The lack of mortgage insurance can be a huge cost saver to veteran home buyers. Conventional and FHA mortgage home buyers can spend hundreds of dollars per month on insuring their loan. None of this money goes toward the principle of the loan and the reduced mortgage payment is simply for protecting the mortgage company from a defaulted loan.
Is the VA home loan right for you?
It is not possible to give a single answer to this question. It really depends on many factors. However, you can decide if the VA home loan is right for you by looking at your VA home loan eligibility. If you are eligible for the VA home loan, it is likely that you will also benefit from it. Because the mortgage program has so many advantages over traditional mortgages, it is best to take advantage of it, if you are approved for it. The reduced closing costs, lack of mortgage insurance, and lower points will always give you a better mortgage payment.
The veteran?s assistance loan is a mortgage loan that helps veterans achieve homeownership. The program offers looser VA home loan eligibility requirements and is a great option for those that qualify. To see if you qualify, work with your local VA home lender. The prequalification process is easy and quick, and you can be on your way to purchasing a new house in no time.