All mortgage programs have their pros and cons, but with VA loans — mortgages reserved for military members and veterans — the advantages win out.
In fact, VA loans are probably the best possible mortgage you can come by. Not only do they offer low interest rates and reduced up-front fees, but they can also help you buy a home sooner (and without thousands in that savings account).
Are you thinking of using a VA loan for your home purchase? Here are the major perks you can look forward to:
1. You don’t need a down payment.
This is a big one, considering today’s home prices. If you were using an FHA loan, making just the minimum down payment (3.5%) would require $8,750. That doesn’t even include closing costs. VA loans are one of the few zero-down loan programs out there.
2. Closing costs are lower.
The VA limits the amount of closing costs a borrower can be charged. They also allow sellers to pay all of the buyer-side closing costs if desired.
3. You can roll your closing costs into the loan.
With VA loans, you can actually finance your closing costs. This allows you to pay them off over time (as part of your monthly payment), rather than all at once on closing day.
4. Reservists can also qualify.
It’s not just members of the five military branches that qualify for VA loans. Members of the Reserves and National Guard can also use these loans, as long as they’ve been an active member for at least six years.
5. There’s no mortgage insurance.
Unlike FHA and USDA loans, VA loans don’t require any mortgage insurance. This can save you significantly up-front, as well as on your monthly payments.
6. There’s a VA refinance option.
The VA’s IRRRL, or Interest Rate Reduction Refinance Loan, makes refinancing easy for military homeowners. It requires no appraisal, and you can roll your refinancing costs into the loan balance. You can also choose a cash-out refinance with VA loans.
7. They’re assumable.
VA loans are assumable, meaning they can be transferred to another eligible homeowner when you sell the house. This can be a great perk when marketing your property, especially if your loan carries a low interest rate that isn’t available to buyers anymore.
Get in touch.
If you’re in the military, are married to a military member, are a veteran, or you’re a member of the Reserves or National Guard, a VA loan can help you purchase a home. Get in touch with a Premier Nationwide Lending office in your area to learn more.
Premier Nationwide Lending is an Equal Housing Opportunity lender. Sponsored by NTFN, Inc. 6201 West Plano Parkway, Suite 100, Plano, TX 75093 | NTFN NMLS 75333.