If you or a family member is a military veteran or active military member, then you’re able to purchase a home using a VA loan for as little as $0 down. Veterans Affairs mortgages are loans issued by private lenders and backed by the United States Department of Veterans Affairs (VA), which makes them more secure and flexible to lenders. If you’re looking for a way to purchase a home without needing a down payment or even excellent credit, then you should consider a VA loan. You’re even able to refinance your existing mortgage using a VA loan if your family is eligible for it, which can save you thousands of dollars over the life of your mortgage. Here’s why VA loans are perfect for military families, and what makes VA loans uniquely different than traditional home loans?
Why Are VA Loans More Important Now Than Ever Before?
Returning home from active service, especially when you’ve been injured or have a disability is incredibly difficult. After the housing market collapse in 2008, lenders tightened their lending standards, which made it more difficult for active military families and veterans to receive a traditional mortgage. VA loans give service members a way to enter the housing market when it was at its most difficult to meet stringent credit and down payment requirements.
In addition to giving service members and their families the ability to purchase a house with no-money down, or to refinance at better rates, using a VA loan also comes with many other benefits. Here are some great reasons why you should apply for a VA loan instead of a traditional loan if you qualify.
A Few Benefits of VA Loans
With traditional loans, you’re required to purchase private mortgage insurance (PMI) whenever you’ve put less than 20% down on a home. With a VA loan, because it’s guaranteed by the federal government, your family does not need to purchase PMI. If you default on your loan, the lender is protected from any loss, making VA loans among the safest mortgage types available. This is also one of the reasons why private lenders can offer better terms for VA loans than they do on traditional loans.
You can purchase a home in Durant, OK, for up to $424,100 without a down payment. If you live outside of Durant and find a home that’s a bit more expensive, there’s also a chance that you can exceed that limit without putting down any money on your home. Either way, your family will save the typical 20% down payment, and there’s a good chance that you’ll pay very little, if anything at all, in closing costs.
Most homebuyers who can qualify for a VA loan don’t end up paying a penny in closing costs. Even the agent’s fees are limited with a VA loan and paid for by the seller in most cases.
So, what’s the catch?
VA mortgages, just like all other mortgages require that the buyer understands all the details. There are also “funding fees,” which can be as low as 0% depending on your financial situation and whether you’re a veteran with service-connected disabilities. It can be as high as 2.15% for first time home buyers, or 3.3% for repeat buyers. This fee goes directly to the VA to keep the mortgage program going and can be rolled into your mortgage payments so that you don’t have to pay a lump payment as a home buyer.
If you’re curious about whether your family qualifies for a VA loan in Durant, OK, give me a call! There’s quite a bit of information you must know and understand before applying for a VA loan, and it can be a daunting process to do everything by yourself.
Give me a call to work with a professional real estate agent who understands the ins and outs of the housing market, and see how I can make both the home-buying and home-selling process easy for you and your family!