If you are a member or a retired member of the United States armed service and meet certain requirements, you can purchase a home with a VA loan. When it comes to securing a VA loan, there are a few things you need to know about the loan process.
No Down Payment Required
You do not have to place a down payment on the home with a VA mortgage, even a small one. Instead of having to save for years for a down payment before you purchase a home, you can buy a home. This will allow you to get into homeownership without having a lot of money saved up.
No Mortgage Insurance
With a regular mortgage, if you don't put down at least twenty percent, you often will have to pay for mortgage insurance. Mortgage insurance can add thousands of dollars to your loan without increasing your equity in your home. You do not have to pay for mortgage insurance with a VA loan even if you don't place a down payment. This can save you thousands of dollars on the overall cost of your mortgage.
It is essential to understand that a VA loan is not a one-time benefit. With a VA loan, once you pay it off, you can get another loan. For example, if you live in a small home and are ready to upgrade to a larger home, you can qualify for a new VA loan once you sell your smaller home. You can use your benefit to buy another home once you pay off the VA loan that you already have.
Even better, your benefit never expires. It doesn't matter if you have been out of the service for five years or twenty-five years; you can continue to use the benefits. Once you qualify for the benefits, you maintain your qualification. Also, it is crucial to understand that your benefit can be used by your surviving spouse as well as long as you have not remarried following the death of your military spouse.
More Lenient Requirements
Finally, with a VA loan, almost all the requirements are more lenient. You can have a lower credit score and still qualify for a VA loan. You can have a bankruptcy or foreclosure in your history and still qualify for a VA loan. Lenders are able to be more flexible about who they approve for a VA loan, as the program is backed up by the federal government, although local lenders administer it.
When it comes to the VA loan process, you don't have to place a down payment, the requirements are more lenient, you don't have to pay mortgage insurance, and the benefits are renewable and without an expiration date. Reach out to a company like Dominion Capital Mortgage for more information.