Know everything about VA home loan
VA home loans are popularly known as Department of Veterans Affairs home loan that offers opportunities to veterans to own or build a home. It also allows them to refinance their existing home mortgage making it easier for them to get ownership of their home easily. Getting a low cost mortgage can be extremely beneficial for someone who wants to own a home even without a good credit score. As a veteran or military personnel, you are eligible for the VA loan that comes with highly competitive interest rates.
This government backed loans is only designed for veterans, present service members and spouses of the veterans. The relentless sacrifice and hard work of the veterans are awarded through the means of this home loan that makes home buying process very easy and hassle free. With low interest rates and no down payment, veterans and their spouses can easily buy their dream home with the financial benefits that does not exist in any other types of mortgages. This is a special kind of mortgage that offers more lenient requirements as compared to the conventional loans but it is important to qualify for this loan before enjoying the benefits that it offers.
Mortgage eligibility of VA Loans
The active duty service members as well as veterans are entitled to get these loans and in some cases eligible surviving spouses of these members can also get the home loan. Mortgage companies and banks provide these loans for someone who is eligible and qualifies for this loan as these private lenders offers favorable loan terms with low interest rates. The loan amount can be used for purchasing a new home, refinancing current mortgage or covering renovation costs. For getting the loan, it is important for an individual or veteran to serve on an active duty for 90 days or more and there is other service benchmark that needs to be fulfilled to get the home loan. Meeting the VA Loan Eligibility Requirements is extremely important where the veteran has to serve for atleast 90 days during wartime and 181 days during peacetime. Additionally, anyone service at the Selective Reserve or National Guard is also eligible to get the benefits offered by VA home loans. If the spouse of a veteran dies line of duty then he/she can also get the home loan and the most important thing is to get a certificate of eligibility (COE) before getting the VA loans.
Benefits of VA loans
The most important benefit of VA home loan is that it helps veterans and spouses to buy a home without any down payment or low interest rates. Additionally, repaying mortgage is also very convenient with VA home loans as it can be repaid without any penalty. Anyone facing temporary financial difficulties can also get assistance as VA loans come with capped lender fees which are limited to 1% of loan amount. Purchasing home with VA home loan comes with zero down payments making it more convenient as compared to the convectional home loans. Additionally, the home buyers do not need to pay for the mortgage insurance even when they are not making down payment as it reduces the burden of buying a new home. Competitive interest rates allows the veterans to save their hard earned money when they are buying their dream home as these loans come with lower interest rates as compared to the convectional home loans.
Limits of VA home loan
There might be many benefits of VA home loans but there are few limits that should be kept in mind while applying for this loan. The most important thing is that funding fees of upto 3.6% of the home loan amount needs to be paid during the closing of the loan but there are few instances when the veterans might be exempt from paying funding fees. There are tougher appraisal requirements that the individual have to fulfill before applying for the VA home loan. These appraisals might be more costly as compared to the convectional home loans making the overall home buying process costlier and time consuming. Additionally, the VA home loan amount can only be use for buying a primary home and not an investment property or second home.
