What You Don’t Know About VA Loans (Part 2)
In our last blog entry, we went over a few facts that not many veterans are aware of when it comes to VA Loans. Today, we’re returning to this topic and going over a few more facts that many veterans don’t know about.
No Down Payments/PMI
With VA Loans, there’s no need for down payments. You can immediately buy the property rather than taking years of saving money for a down payment. Not only that, but you can also avoid steep mortgage insurance fees, be they private or otherwise. Using a VA Loan saves you money upfront and increases your buying power tenfold.
Availability from Local Lenders
VA home loans are unlike most other VA Benefits. They’re available from private companies rather than the government. The Department of Veterans Affairs does not take applications, approve the loans, or issue funds. Rather, it’s the private banks and credit unions that handle that aspect. The VA provides insurance to lenders, a process is known as the VA guarantee. This assures that the lender will be repaid if the veteran can no longer make payments. In turn, lenders can issue loans at superior terms. To put it simply, VA loans give you the best of both worlds, allowing you to have all the benefits of a VA loan with the convenience and speed of working with the lender of your choice.
Condo Purchasing
While you can purchase a variety of properties with a VA loan like sing-family homes, manufactured homes, and four-unit homes, you can also purchase a condominium with a VA loan. Often overlooked by VA home buyers, condominiums are ideal starter homes and are perfect for those looking to find an affordable living space. In fact, the VA maintains a list of approved condominium communities, so make sure to further study and look into your current surroundings as to which condo is near you.
Leniency
Unlike many loan programs out there, low credit scores, bankruptcy or foreclosure cannot disqualify you from getting a VA loan. VA guidelines state that you don’t need a minimum credit score to qualify, giving lenders leniency to approve loans with lower scores. In addition to that, VA considers your credit re-established when you have two years of established and clean credit following a foreclosure or bankruptcy. Due to a loss of income, medical emergency, or some unforeseen event, many homeowners in the U.S., military, and civilian, can experience bankruptcies. Thankfully, these financial setbacks don’t bar VA-eligible home buyers from owning a home. The only exception when it comes to this is foreclosures with VA loans, as you may have to pay back the amount owed on the foreclosed loan to regain eligibility.
The following facts we presented in the past two blogs are just a few that we can think of, but there are more reasons and facts as to what VA loans can bring. If you’re looking for further information about VA Loans and what they can provide for you, the offices of Mortgages Done Right can help you out! Contact us today to learn more about our services and experience in the mortgage field. Until next time, have a lovely day.