VA loan offers service members, veterans and their families a chance to have the house of their own and is a testament to the nation's commitment to give a better life to those who served the country. The Department of Veteran Affairs (VA) does not lend money for the loan; it partially guarantees the mortgages made through private lenders such as mortgage companies, banks and credit unions.
What Makes VA Loans Lucrative?
• Interest rate is a little lower than that of a conventional loan
• No down payment is required (in case the purchase price is lesser then the appraised value)
• Can be given to individuals with higher debt-to-income ratios and lower credit scores
• No private mortgage insurance is required on loans that have more than 80 percent of a home's appraised value
• No prepayment penalty is imposed if an individual eliminates the mortgage before the schedule
• Negotiable interest rate
• VA assistance provided to the borrowers who default the payment due to a temporary financial difficulty
Who is Eligible for a VA Loan?
Whether you are looking for VA home loans Texas or in any other state, you need to meet the eligibility criteria to get the loan approved. If you fall into any of the categories mentioned below, you are eligible for VA loan:
• Veterans
• Active-duty personnel
• Reservists/National Guard members
• Surviving spouses
Fees
The cost of getting a VA loan is less than other types of mortgages, still, there's a one-time funding fees that varies according to the amount of the down payment and veteran type. For example, if the borrower is with the armed forces and applying for the VA loan for the first time with zero down payments, he would be required to pay a fee of 2.15 percent of the total loan amount. In a scenario where the borrower makes a down payment of 10 percent, he will have to pay 1.25 percent of the loan amount as the fee. For those applying for the VA home loans for the second time without a down payment, they will have to pay 3.3 percent of the total loan amount.
The regional loan centers of VA are across the U.S. in Cleveland, Atlanta, Denver, Phoenix, Texas, St. Paul, and a few more areas. Individuals seeking for VA home loans can visit the website of VA to find out more details of the center that services the state they live in or seek assistance from a loan service company.
