By Cindy W. Lundy
Veterans have received guaranteed, VA Home Loans, since the GI Bill was approved in 1944. Conventional? home loans have more challenging qualifications than the VA program for mortgage loans, with more flexible requirements on income and credit.
Along with easier qualifications, about 90% of veterans were granted 100% financing, making no down payment required. The 20% down payment is typical of conventional financing requirements. The requirement of a 20% down payment, which can amount to tens of thousands of dollars, can hinder people from buying a home.
VA benefits have made it possible for some veterans to afford a home, that could have never purchased one using a conventional program. However, there are only about 20% of all the veterans that actually know about the VA mortgage loan program. VA benefits are being used by about 1 in every 10 veterans, which shows that there are lots of veterans that need to gain knowledge about the program.
Along with the opportunity for many veterans to secure 100% financing, there are possibly some additional savings to help veterans become home buyers. No closing costs for some of the loans to the veterans, is another savings factor to contemplate. Purchasing a home for a veteran is becoming much less demanding, without the requirement of a down payment and possible savings on closing costs.
Veterans that are on active duty or honorable discharge, can join in the VA mortgage loan program. The Certificate of Eligibility or COE, is a simple part of the qualification process to receive the VA home benefits, plus the additional advantage of flexible financing terms. Surviving? military spouses and some National Guard members may also be eligible to receive benefits from the VA.
Conventional loans for homes, that are for homes with financing of over 80% of the value of the home, need to have Private Mortgage Insurance. PMI is not a requirement for VA mortgages, which is an additional benefit for veterans to use their VA house loan.
An additional benefit that will assist the veteran, is the low interest rates. VA is the best choice to help veterans, get a home loan with the best terms. VA mortgages are easier to qualify for, with requirements that are much more adaptable. Credit requirements are much easier regarding VA home loans, compared to a conventional loan.
Disabled veterans may receive an exemption of the VA funding fee, which may be financed if not exempted. If the down payment is 5%, the veteran may be given a reduced VA funding fee. Home ownership can be affordable, because of all the VA options available. With interest rates turning out to be so low, this is a very good time for veterans to investigate VA home loans.
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