VA Loan Overview
What is a VA Loan?
A VA loan is a mortgage loan in the United States guaranteed by the United States Department of Veterans Affairs (VA). Mortgage Network is a VA qualified Lender. The VA loan was designed to offer long-term financing to eligible American veterans or their eligible surviving spouses.
VA helps Service members, Veterans, and eligible surviving spouses become homeowners. As part of their mission, they provide a home loan guaranty benefit and other housing-related programs to help buy, build, repair, retain, or adapt a home for their own personal occupancy. VA Home Loans are provided by private lenders, such as banks and mortgage companies. VA guarantees a portion of the loan, enabling the lender to provide more favorable terms.
VA vs. Traditional Loans
|0% Down for qualified buyers
VA Loans are among the last 0% down home loans available on the market today.
|Up to 20% down
Conventional loans generally require down payments that can reach up to 20% to secure a home loan, pushing them out of reach for many home buyers.
|Easier To Qualify
Because the loan is guaranteed by the government, lenders assume less risks and have less stringent qualification standards for VA Loans, making them easier to obtain.
|Standard Qualification Procedures
Conventional options hold stricture qualification procedures that can put home ownership out of reach for some home buyers.
Since VA Loans are government guaranteed, lenders do not require Private Mortgage Insurance.
Mortgage Insurance is a requirement for borrowers who finance more than 80% of their home's value, tacking on additional monthly costs.
|Competitive Interest Rates
The VA guaranty gives lenders a greater degree of safety and flexibility, which typically means a more competitive rate than non-VA loans.
|Increased Risk for Lenders
Without government guaranty, lenders are taking on more risk which, in turn, can result in a less-competitive interest rate for borrowers.
Benefits of a VA Loan
Military homebuyers have access to one of the most unique and powerful loan programs ever created. The VA Loan is a mortgage loan issued by approved lenders and guaranteed by the U.S. Department of Veterans Affairs (VA). Benefits of VA Loan include:
- Purchase a home without a down payment (100% LTV) provided the sales price doesn’t exceed the appraised value and the Veteran qualifies in terms of income and credit
- VA rules limit the amount Mortgage Network can charge for closing costs
- Up to 4% of the property value in closing costs may be paid by the seller
- VA may be able to provide assistance if making payments becomes difficult for a Veteran
- Veterans do not have to be a first-time homebuyer
- VA loans are assumable
- Minimum 580 FICO Purchase & Refinance
- Fixed Interest Rate
- Gifts Allowed
- All Veterans of U.S. Armed Services — Army, Navy, Air Force, Marine Corps, Coast Guard
- Currently on Active Duty or Discharged under honorable conditions
- National Guard and Reserves — Eligible upon completion of 6 years, unless released earlier due to service-connected disability
- Unmarried surviving spouses of a veteran who died as a result of service or service connected causes
- Borrowers must have a Certificate Of Eligibility (COE) to qualify for a VA loan