For almost 80 years, no money down VA (Veteran’s Affairs) home loans have eased the path to homeownership for millions of Veterans who otherwise might not have had the chance to build their wealth through real estate. It’s one of the top benefits of military service in the United States and if you or someone you know served in the military, you’ll want to understand the benefits of using this loan.
Here are some important things to know about VA loans before you buy a home.
What Are The Advantages of VA Home Loans?
According to the Department of Veteran Affairs, these benefits include:
- No Down Payment: If you qualify for a VA Loan you can purchase a home with no down payment up to the maximum loan amount allowed by VA in your area.
- Reduced Closing Costs: Certain expenses, that are a normal part of the loan process, are excluded for Veterans including real estate attorney fees, real estate broker fees, real estate agent fees, loan application fees, fees to set up an escrow account, rate lock fees, and any appraisal or inspection fees beyond the initial property appraisal.
- Does Not Require Private Mortgage Insurance (PMI): Most loan programs with low down payments require that the borrower pay Private Mortgage Insurance which can be a substantial portion of your monthly mortgage payment. With VA loans, the government is basically “guaranteeing” to make good on a portion of your loan if you default and this negates the need for PMI or a 20% downpayment.
Active duty service members and Veterans who qualify for VA loans have earned this right and it’s a wonderful way for our government to say “thank you” and honor their service with a benefit that can be life-changing.
