Benefits of a VA Home Loan
There are numerous benefits associated with VA Loans when compared to other home mortgage options. However, thelargest benefit to a veteran is no requirement for a down payment and no Private Mortgage Insurance. The below categories outline the various benefits associated with a VA Loan.
No Down Payment
The VA Loan is the only loan of its kind that allows for no money down as a down payment. In many instances this allows the borrower to purchase a home without having the savings to place 20% down on a home which is typically required for a conventional mortgage.
No Private Mortgage Insurance (PMI)
The VA Loan removes the requirement to obtain Private Mortgage Insurance (PMI). PMI is typically required for any mortgage where the down payment is less than 20%. This insurance payment is what banks typically require as an insurance policy to reduce the risk of defaulting on the loan. PMI payments are normally between $50-$150 a month depending on the size of the mortgage and can go much higher.
No Pre-Payment Penalties
Many other loan options will penalize someone for paying off their mortgage early because the bank makes less money the sooner you pay off your loan. This allows the veteran the option to pay their loan off quicker by applying more of their payment to the principle and paying their loan off sooner, if they choose.
Regulated Closing Costs
The VA places a limit on what closing costs can be charged by a lender. This limits the amount of fees that a lender is legally allowed to charge you in connection to your loan. In addition, the VA allows for the seller to pay for your closing costs. This is a negotiable item that is between the buyer and the seller.
With permission from the VA you can have someone else assume your mortgage. This transfers liability of the loan from you to whoever assumes the mortgage. It is required to get permission from the VA if you choose this route.
If a VA Loan becomes delinquent the VA will take an active role in working with the loan servicer in instances where the loan servicer can’t help the veteran. Two special servicing centers provided by the VA are available to assist with these issues. You can reach VA Loan Specialist with the VA by calling 877-827-3702.
VA Loan Captain, Inc. is a Service Disabled Veteran Owned Small Business (SDVOSB) that assists veterans and servicemembers purchase or refinance a home at a competitive interest rate with their network of VA Approved Lenders. As a company with a social mission $200 is provided to a veteran focused charity for every loan closed.
For more information please visit www.valoancaptain.com