If you're a military veteran or the spouse of a military veteran, you may be eligible for a VA home loan. VA home loans are one of the best mortgage options available, and they offer several benefits that other types of mortgages don't.
In this blog post, you'll learn more about the eligibility requirements, the application process, and the benefits of using a VA home loan. So if you're interested in learning more about these mortgages, keep reading.
What Are VA Home Loans?
VA home loans are mortgage loans guaranteed by the U.S. Department of Veterans Affairs (VA). These loans are available to eligible veterans, reservists, active-duty service members, and certain surviving spouses.
The VA does not lend money for these mortgages—they simply guarantee a portion of the loan, which protects the lender in case of default. This guarantee allows lenders to offer more favorable terms to borrowers, which is why VA home loans are often called "VA-backed mortgages."
There are two types of VA home loans:
In many cases, VA home loans are available with no down payment and no private mortgage insurance (PMI) required. This makes them an excellent option for eligible borrowers who may not have the funds for a traditional down payment.
What Are the Terms?
The terms of a VA home loan are very favorable for borrowers. VA home loans typically have lower interest rates than other types of mortgages, and they can be fixed-rate or adjustable-rate loans.
You can choose a fixed-rate loan with a term of 15, 20, or 30 years, or you can opt for an adjustable-rate loan (ARM) with a shorter initial term. The interest rate on an ARM may be lower than a fixed-rate loan at first, but it can change over time.
The VA also limits the number of closing costs that veterans can be charged for VA home loans. This helps make these loans more affordable for borrowers.
VA Home Loans Application Process
The first step in applying for a VA home loan is to get a Certificate of Eligibility (COE). You can apply for a COE online, and you'll need to provide some documentation to prove your eligibility.
You'll also need to find a lender who offers a VA home loan program. Not all lenders do, so you may need to shop around to find one that does.
Once you've found a participating lender, you'll need to fill out a loan application and provide any required documentation. The lender will then review your application and make a decision.
Contact a local lender that offers VA loans for more info.
Share3 June 2022
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