This week, we are discussing the benefits and features of VA loans. As a way of saying thank you, the VA has created a loan program to make owning a home a little easier for those who served our country.
It is great to be here to chat about a loan program that, in a way, gives back to our brave men and women wo served in our military. A Veterans Affairs loan, often referred to as a VA loan, is a home financing option offered by the U.S. Department of Veterans Affairs. These loans are very effective in helping our veterans and military families achieve their dreams of owning a home.
VA loans are backed by the VA, reducing the risk for lenders AND encouraging lenders to offer more favorable terms and typically lower interest rates. This makes homeownership more accessible than ever for our service members and veterans by allowing them to obtain a mortgage with most often no down payment.
The VA loan program acknowledges the commitment and sacrifice of our military personnel and provides greater flexibility in terms of credit requirements. Another major perk is that VA loans do not require private mortgage insurance, or PMI, like other loan programs. PMI is an additional monthly expense that borrowers typically must pay if they make a down payment of less than 20% on a loan. By eliminating PMI, VA loans can save veterans a significant amount of money each month. Plus, the funding fee for VA loans can often be rolled into the loan amount reducing upfront expenses.
Q: What if I am a Veteran with a VA loan? Are there any options for me to get a lower interest rate?
A: Another significant feature of VA loans is their ability to assist with refinancing. If you currently have a VA loan, you can explore options like the VA Interest Rate Reduction Refinance Loan (IRRRL), which allows you to lower your interest rate and monthly payments. This can free up extra cash for other essential aspects of their life. I am not saying right now is the best time to refinance, but when rates come back down, and they will, it is something for all current VA borrowers to consider.
Q: These are excellent benefits for the brave men and women who have, or are, serving our country.
Does a VA loan require an appraisal?
A: Like all other loans, an appraisal is required. The VA appraisal ensures the home meets specific quality standards, giving our veterans and their families peace of mind and protecting their investment.
We have discussed seller concessions before, and VA loans allow up to 4% in seller concessions. These concessions can be used for specific closing costs.
So, if you’re an active-duty military member, a veteran, or a surviving spouse, don’t miss out on the unique benefits of a VA loan. Take advantage of lower-interest rates, flexible credit requirements, and the ability to finance your dream home with little to no down payment.
Until next week, this has been your weekly Motto Moment with John Kunkel. If you want to buy your first home, dream home, investment property, or farm, call me at 479-621-3500 and let’s discuss how I can help you. I’m John Kunkel, your Motto Mortgage Loan Officer. Unlocking homeownership dreams one key at a time.
John is licensed in Arkansas, Arizona, Kansas, Louisiana, Missouri, and Tennessee. Motto Mortgage offices are independently owned, operated, and licensed. An equal housing opportunity. John Kunkel NMLS 1-4-1-6-0-7-8, Motto Mortgage United Group NMLS 2-0-7-8-9-1-5, Velocity NMLS 2-2-8-8-2-5-6, and Heritage NMLS 1-7-2-0-4-3-8.
