If you are a Veteran, you should know about the special mortgage benefits available to you through the VA Financing Program. Take advantage of this program! It's designed to make purchasing a home as affordable, and accessible as possible.
Here are the four biggest benefits of financing with a VA loan:
1. No Down Payment! This is HUGE, and certainly the defining benefit of the VA program. Instead of having to pony up the usual minimum down payment of 3.5-5% Veterans are given the opportunity to finance the entire cost of their home.
2. No Mortgage Insurance. Conventional borrowers who cannot afford at least a 20% down payment will be required to purchase mortgage insurance which can easily tack a couple hundred dollars onto their monthly mortgage payments. VA loans do not require mortgage insurance as they do not require a down payment. There is an upfront fee, however, that can be completely financed. If you were wounded during service that fee will be waived entirely.
3. Flexible Requirements. The VA program is designed to get Veterans into homes. With that in mind, normal requirements are suspended or made much more achievable. For example, a Veteran will receive full financing even with a credit score 100 points lower than what a normal borrower could get away with. Veterans can even secure financing if they have very recently gone through bankruptcy, foreclosure or a short sale. If you think you're situation puts you in too tough a spot to receive financing - think again! Please visit a lender to find out how they can help.
4. Closing Cost Limits. Unfortunately closing costs can never go away entirely, but the VA puts a cap on what Veterans are allowed to pay. They even make it possible for sellers to pay ALL of the buyers closing costs AND up to 4% of the loan amount in concessions. Keep that in mind when you and your Realtor negotiate the contract!