Financing Benefits of VA Home Loan Program

What are the financing benefits of VA mortgage loans verses the FHA programs?

Let's take a look at how the two compare.

FHA Loan Benefits

• Terms of 15 or 30 years
• Monthly Repayments
• Minimum down-payment of 3.5%
• Less focused on your credit score than conventional programs
• Allows you to leverage the loan more heavily than many conventional mortgages

VA Home Loan Program Benefits

• No Pre-payment Penalties
• Can apply for the loan just 2 years after you have emerged from bankruptcy.
• Can apply for the loan just three years after a foreclosure.
• Home can be financed up to 100%.
• No down payment required.
• Loans typically limited to $417,000
• No mortgage insurance premiums to pay
• Loans tend to be at preferential interest rates because of the Government underwriting

Additional VA Benefits for Home Buying

The biggest of these is that potentially a veteran and his family can buy a home without the need for a down payment, whereas FHA loans require a minimum down payment of 3.5%.

This doesn't sound like a lot, but consider for a moment that the average median sales price for a home in the Bronx in New York for example was $366,010 in November 2011, and so 3.5% of that is $12,810 that would have had to be found as a down payment. And as the exact same story is repeated right across the country, it immediately becomes clear why NOT having to pay that is a big advantage.

In addition, the VA home loan program is automatically available to ALL eligible veterans, and the nature of the way it works means that it is very attractive for lenders to loan money to veterans to purchase homes under this scheme.

And if you have ever previously been foreclosed on, or suffered a bankruptcy, then the terms of the VA Mortgage Loans scheme are quite simply the most lenient around.

Both schemes are potentially useful, but if you are a veteran (or a veteran's wife) and are eligible, then you should certainly look more closely at the financing benefits of VA Mortgage Loans. Are you ready to apply for one of these mortgages? Click here to get the process started.

If you have any questions on these financing benefits for a VA loan, don't hesitate to ask it here.

Remember, even for a VA loan you need to make sure to have good credit.

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