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A VA (Veterans Affairs) loan is a type of mortgage loan that is guaranteed by the U.S. Department of Veterans Affairs. These loans are designed to assist eligible veterans, active-duty service members, and certain surviving spouses in obtaining home financing with favorable terms.
The US Department of Veterans Affairs backs VA loans, and their purpose is to help veterans, widowed military spouses, and active-duty members become homeowners. These types of loans come with many benefits:
In addition to the benefits listed above, VA loans can be easier to secure for veterans, active duty service members, and their families. The best part about a VA loan is that it requires zero downpayment, so you can get a house even if you don’t have a lump sum of cash to put forward.
At the same time, not having a downpayment doesn’t necessarily impact your monthly rates with a VA loan. With a traditional mortgage, lower down payments translate to higher monthly payments. But with a loan backed by the Department of Veterans Affairs, you can get a new home and still have affordable payments and good interest rates.
Unlike a conventional loan, VA loans don’t require private mortgage insurance (PMI). If you borrow a conventional loan for a home, then you’ll have to pay for this type of coverage if you put less than 20% down on your property.
Since VA loans don’t have a downpayment requirement, you can avoid paying for PMI or worrying about sky-high interest rates because you didn’t put down a lot of money upfront.
Typically, monthly payments are about 0.25% lower for VA loans than conventional loans. You can not only save money initially but pay less to eventually own your house as well.
Many people think that VA loans are only available to veterans, however, other military personnel can be eligible as well.
If you are a widowed military spouse, current military spouse, or active duty service member, you may also be able to apply for a VA loan. If you have the option to take advantage of this government-backed home financing, we highly recommend it.
When in doubt, pick up the phone and call Champions Mortgage; our experienced personnel will answer all the questions you have. We will help you find out if you can apply for a VA or any other loan.