A VA loan is a mortgage loan guaranteed by the U.S. Department of Veterans Affairs. The loan is made by private lenders (banks, savings and loans, or mortgage companies) to eligible veterans. The guaranty provided by the government protects the lenders against losses should the borrowers fail to repay the loan. It also allows the borrowers to obtain more favorable loan terms from lenders.

A VA loan is designed for veterans who want to buy a home or residential condominium, build a home, repair or improve a home, or refinance an existing home loan, among other things.

Benefits of a VA Loan:

• There is equal opportunity for all qualified veterans.
• There is no down payment (unless required by the lender or the purchase price is more than the property's reasonable value).
• The buyer is informed of the reasonable value.
• There is a negotiable interest rate.
• There is an ability to refinance the VA funding fee.
• The closing costs are comparable with other financing types (and may possibly be lower).
• There are no mortgage insurance premiums.
• There is an assumable mortgage.
• There is right to repay without penalty.
• For homes inspected by VA during construction, there is a warranty from builder and assistance from VA to obtain cooperation of builder.
• VA provides assistance to veteran borrowers in default because of temporary financial difficulty.

To be eligible for this program, borrowers must acquire a Certificate of Eligibility (which can be obtained from lenders). Borrowers must also provide a proof of military service. Service requirements range from ninety days (active duty during wartime) to six years (National Guard). The borrowers' income must be sufficient, stable, and reliable. Eligible veterans must live in the property or plan to live in the property upon its completion.

If you’d like to know if this loan is right for you, please contact us. We’d be happy to help.