What is a VA Mortgage Loan?
A VA mortgage loan (known as a Veterans Administration home loan) is one of the most exclusive benefits for those who have served or are presently serving in the U.S. Military. Based on your Certificate of Eligibility, you can use a VA loan to purchase or refinance a home that you occupancy without having to make a down payment. The Veterans Administration backs the VA loan only for veterans, and there is no private mortgage insurance (PMI) requirement.
What can a VA home loan be used for?
According to U.S. Department of Veterans Affairs website
- Buy a home, a condominium unit in a VA-approved project
- Build a home
- Simultaneously purchase and improve a home
- Improve a home by installing energy-related features or making energy-efficient improvements
- Buy a manufactured home and or lot
- To refinance an existing VA-guaranteed or direct loan for the purpose of a lower interest rate
- To refinance an existing mortgage loan or other indebtedness secured by a lien of record on a residence owned and occupied by the veteran as a home
How VA Loans Work
VA loans are designed for active military personnel, veterans, and military families only.
If this is your first time applying for a VA loan, you must first meet the VA’s guidelines to be eligible. If you have used your VA benefits in the past, you may be able to use it again.
For full details, visit VA Guidelines.
We are an Approved VA Lender
Benefits of a VA Loan
- Borrow up to 100% of your home´s value. Most veterans and service members won´t need a down payment.
- You can qualify with a lower credit score and more debt to income ratio compared to conventional loans.
- VA loans could have lower interest rates, so you pay less over time.
- Availability of fixed-rate loans.
- The seller may pay closing costs.
- Lenders are limited on what they can charge for some fees.
- No requirement for private mortgage insurance (PMI).
- The ability to finance the VA funding fee (reduced funding fee based on down payment or exemption for veterans receiving VA compensation)
- Right to prepay your mortgage without penalty.
- VA Loans are assumable.
Refinancing with a VA Loan
- Get better interest rates than home equity loans and lines of credit.
- With a VA cash-out refinance, you can borrow up to 100% of your home´s value.
- You can also replace your adjustable-rate mortgage (ARM) with a fixed-rate mortgage.
- VA Streamline Refinance or IRRRL process, with no need for an appraisal or income and asset verification.