The Veterans home loan is popular, especially as more and more individuals turn to the military to get an education and other benefits. In 2015, a total of 134,808 home loans went to veterans who were first-time homebuyers. There are many lending institutions, and VA home loans offer a lot of options.
The loans are backed by the Department of Veteran Affairs and are available with no down payment, and very little out of pocket costs for veterans.
But lenders can set their own requirements and fee schedules, so loans from companies can look very different, even on the same house.
It's up to the veteran to look around and find the best deals. And here are some facts that can help that process.
Lowest Interest Rates
The Veterans home loan has the lowest rates on the market and has had that for the last 36 months. That often comes as a surprise to most borrowers, but it's a pleasant one.
However, as there is not a single standard rate for this interest, there is a heavy recommendation that a veteran shop around at the various providers for VA home loans. They can offer many different terms. There are also sites that compare rates, and make this process easier.
Limits on Closing Costs
VA lenders are allowed to charge no more than 1% of the loan amount to cover origination, processing, and underwriting costs. If they don't charge that 1%, costs such as attorney fees, underwriting and document fees, cannot exceed 1% of the loan. This saves the VA buyer a large amount of initial investment on the loan.
Eligible If Served
Many homebuyers don't look at VA mortgages or VA home loans because they don't realize they qualify. According to a VA survey, one in three homebuying veterans doesn't know about their mortgage benefit. There have been programs about educating veterans on their benefits, and progress has been made in making sure they know. To close the VA loan, you need a "Certification of Eligibility" from the VA. You can acquire this directly from the VA, or through your lender.
If you are a veteran and looking to apply for a Veterans home loan, you should know your benefits and consider getting a VA loan. You should also be aware of the various rates and providers available to you. If you have any questions, feel free to contact us. We'll be happy to help.