Most veterans who are thinking of buying their own home find that obtaining a VA loan is their best option. The loans are flexible, and there is no down payment required, making them ideal for getting into the housing market in the least expensive way possible.
However, many veterans are not familiar with the way VA loans can benefit them. There are several facts about VA loans which are useful to know, if you are a veteran who is thinking about buying a home for the first time, or moving to a new property. The US Department of Veterans Affairs provides advice about the process, and here are some key informative facts.
Borrowing is not a one-time opportunity
If you are wondering how many times can you use a VA loan, there is good news. These loans can be accessed more than once, even if you currently have a VA loan in place; up to your maximum entitlement.
Loans are for a certain type of property
If you are looking for a home that is a project, you may find that you cannot secure a VA loan. They are usually intended to be used to purchase properties which are in a good condition and can be moved into immediately.
You can only buy a primary home
VA loans are intended to be used to purchase a property that is going to act as a main home. They cannot usually be used to buy investment properties or vacation homes.
The money does not come from the VA
People who receive a loan form the VA may think that at least some of the money comes from the Agency. This is not the case. The money is provided by lenders but the government guarantees around a quarter of the loan. This is what prompts the lender to offer excellent rates and terms.
Foreclose and bankruptcy may not be an issue
Whereas foreclosure and bankruptcy are an issue when trying to secure a traditional loan, they do not normally present a problem when applying for VA loan benefit.
There is a fee involved
Although there is no down payment required for a VA loan, there is a fee payable. This money goes to the VA, to help keep the program going. Any loan applied for has a fee attached but applicants can apply to have it rolled up with the mortgage. Any veterans who have a service related disability can ask for the fee to be waived.
There is no pre-payment penalty
You will not pay any penalties if you pay more than you should monthly, when you have a VA loan. You can choose to pay more than the minimum and save on a lot of interest. This flexibility is one of the things that is so attractive about VA loans.
If you are a veteran who is weighing up the pros and cons of buying a home, you should consider applying for a VA loan as part of the process.