Veteran Administration (VA) Loans: The most flexible lending option
Why do a lot of people consider Veteran Administration (VA) loans as the most flexible lending option? The fact that veteran association provides a guarantee for lenders adds a great amount of credibility to these loans and if the borrower makes any default, the association pledges to pay about a quarter of the loan to the lender. This guarantee provides the much required protection for lenders and qualified veterans will be able to avail this loan with competitive rates and terms as well.
The VA loan guarantee program came into existence in 1944 and, since then, it has helped more than 18 million members to purchase homes. Recent trends indicate that the popularity of these loans is going to reach new heights in the immediate future and the opinions of the existing users reassert this opinion without a shadow of doubt. The primary aim of this program is to provide long-term financial assistance to deserving veterans and the veterans will be allowed to get 103.15% financing without having any private mortgage insurance.
Benefits of veteran administration (VA) loans
1) It is a lending option that provides 100% financing
2) You can purchase homes without any down payment
3) It offers flexible loan standards and requirements in comparison with other mortgages
4) There will not be any monthly expenses like private mortgage insurance
5) Lower and competitive interest rates
6) You do not have to pay any pre-payment penalties
7) It allows higher debt-to-income ratios
8) You will be able to enjoy streamlined refinancing loans without any additional underwriting
You will have to fill out VA form 26-1880 while applying for this loan and it can be described as the request for your certificate of eligibility.
The veteran administration will issue this certificate and people like veterans, active duty, guard or reserve and military spouses are the potential candidates who qualify for this type of loan. There will not be any maximum limit on a VA-guaranteed loan amount for an eligible veteran, except the county limits and, in normal circumstances, veterans will be eligible for $417,000 with no money down. In some areas, especially high-cost places, people will be eligible for up to $625,500 as well.
Flexible conditions, clear cut guidelines and highly beneficial packages make veteran administration (VA) loans an extremely appealing option and when you compare other types of mortgages with VA loans, you will come to know the huge benefits associated with them. The guarantee that veteran association provides makes the lenders extremely comfortable as well.