The Veteran’s Administration (VA) loan is a no-money-down mortgage option available to Veterans, Service Members, and select military spouses. The VA home loan was conceived in 1944 to help returning service members purchase homes without needing a down payment or excellent credit. Guaranteed by the U.S. Department of Veterans Affairs (VA), this loan program has helped more than 25 million Veterans, active duty military members, and their families purchase or refinance a home.

Here are the top 5 reasons you should choose a VA loan if you qualify.

1. No Down Payment Needed

VA loans are one of the last 0% down mortgages available on the market today. This gives the borrower a unique advantage, as they now have flexibility with the funds they would typically use for a down payment. These funds can be used to buy down their interest rate, pay above appraised value (something that is very common in our current housing market), or just keep it in their pocket! 

2. No Mortgage Insurance Required

Mortgage Insurance is an additional fee that is tacked on to the monthly payment on most mortgages. This fee acts as an “insurance policy” to help lenders compensate for the losses they would receive if the borrower defaults on the mortgage. Mortgage insurance can either be public or private, depending upon the insurer. However, a VA loan does not have any mortgage insurance, helping the borrower save that cost every month! 

3. Best Interest Rates

Because the federal government backs VA home loans, lenders can charge extremely low interest rates for VA loans. Eligible veterans and service members find that rates are generally lower with a VA home loan than a conventional mortgage. Just another perk for the Veteran! 

4. Seller Can Pay All Closing Costs and Prepaids

On a normal purchase, the buyer is responsible for the costs associated with the transaction. With a VA loan, however, the seller can pay all of your closing costs and prepaids! Obviously, this is a massive benefit for the buyer and one of the big selling points for VA loans. Sellers are not required to pay closing costs, so the decision is part of the negotiation between buyer and seller.

5. Seller Can Pay Off Veterans debts

One of the VA mortgage’s unique features is that the seller can pay Veterans’ debts such as student loans, car loans, and/or credit debt! This is an immense help when trying to structure the loan to make the numbers work. There is a limit of 4% on the maximum seller concessions used towards the Vet’s debt. 

If you are a veteran and would like to take advantage of all these benefits and more, call us at (727) 376-6900.