Benefits and Reasons to use the VA Loan Program
VA LOANS
CONVENTIONAL LOANS
0% Down
(for qualified borrowers)
VA loans are among the last 0% down home loans available on the market today.
Up to 20% Down
Conventional loans generally require down payments that can reach up to 20% to secure a home loan, making it unaffordable for many homebuyers.
NO PMI
Since VA loans are government backed, banks do not require you to buy Private Mortgage Insurance. VA has what is called the VA Funding Fee, explained within.
PMI Required
Private Mortgage Insurance is typically required for borrowers who finance more than 80% of their home’s value, creating additional monthly expenses.
Competitive Interest Rates
VA loans typically have lower rates than conventional loans. You can compare when you start the process of pre-approval.
Low Rates at a Cost
Buyers often need top-tier credit scores to tap into the best conventional mortgage rates. With VA loans, Veterans have access to low rates without the need for higher credit scores.
Easy to Qualify
The VA loan is a hard-earned job benefit created to expand access to homeownership for Veterans and in-service members. More flexible and forgiving credit underwriting guidelines are a hallmark of the program.
Standard Qualification Procedures
Conventional mortgage options often require higher credit scores and down payment requirements than VA loans, along with stricter underwriting guidelines in most cases.
Types of VA Loans
The VA loan benefit offers qualified Veterans multiple powerful home financing options.
VA Purchase Loan
Refinance Rate Reduction
Cash out Refinance to 90% of the property value
Good News
Veterans and service members can use the VA loan to purchase new built homes or existing homes with a $0 down payment! VA purchase loans allow Veterans to buy single-family homes, condominiums, manufactured homes, multiunit properties (like a duplex) and even new construction.
The VA home loan was created in 1944 by the United States government to help returning service members purchase homes without needing a downpayment or excellent credit. This historic program has guaranteed millions of VA loans, helping Veterans, active-duty military members and their families purchase or refinance a home.
Although the VA loan is a federal program, the government generally does not make direct loans to Veterans. Instead, private lenders finance the loan while the Department of Veterans Affairs offers a guaranty.
This guaranty protects the lender against total loss should the buyer default, which provides an incentive for private lenders to offer the VA loan with better terms that other mortgage options.
Qualified Veterans with their full BA loan entitlement can borrow as much as a lender is willing to extend, all without a down payment.
The VA Funding Fee goes directly to the VA to ensure the program keeps running for future generations of Veteran and military homebuyers by removing any additional burdens off taxpayers and Veterans.
Va borrowers can roll the funding fee into their overall loan amount.
The VA also exempts some Veterans and surviving spouses from the funding fee entirely. The most common exemption is for veterans receiving compensation for a service-connected disability. Surviving spouses with a VA loan eligibility are also exempt.
Va loans are arguably the most powerful loan option on the market. They come with a list of big-time benefits, including $0 down payments, no mortgage insurance, flexible and forgiving credit guidelines and the industry’s lowest average fixed interest rates.
Loan pre-approval is a key first step before making an offer on your dream home. Having that pre-approval letter gives you a clear sense of your purchasing power and shows sellers and listing agents you have what it takes to get to closing.
Yes, this is not a one time option. Once you earn the VA loan benefit, it’s yours for life. You can reuse the VA loan repeatedly. You have earned it; VA financing is the best way to go without a doubt!