A VA loan may be one of the best lending options on the market today. They began as a way to help returning service members achieve the dream of homeownership. Today, with the many benefits VA loans offer, they have become more popular than than any loan product on the market.

Benefits of a VA loan

Above all other benefits of the VA loan is the fact that the veteran does not have to put any money down. Aside from the government’s UDSA Loan (Rural Development home loan) or Fannie Mae’s Home Path, there aren’t many options available any longer for 100% financing.

One of the other benefits is that VA loans come with less strict underwriting standards and requirements than most other loans. In fact, with PMI guidelines tighter than ever, over three quarters of VA borrowers could not have qualified for a conventional loan. This leads to the third most important benefit of VA loans….they come with no private mortgage insurance (PMI), a monthly expense that conventional borrowers are required to pay unless they put down at least 20 percent of the loan amount.

Another little known, but huge benefit to VA loans is that they are assumable. Why is this a benefit? Should you look to sell your home later in a higher rate environment, the buyer can assume your loan at the lower rate you obtained when you purchased or refinanced the home. This could make purchasing your home very attractive and possibly allow you to sell for more than you might get if not assumable.

Other benefits of VA loans:

• Competitive interest rates that are most always lower than conventional rates
• No prepayment penalties
• Sellers can pay up to 6 percent of closing costs and concessions
• Higher allowable debt-to-income ratios allowing easier qualifying
• Ability to Streamline refinance your VA loan with no income verification and in most cases, no appraisal

Aside from all of the benefits mentioned, one that many veterans miss out on is NO LENDER FEES WITH NO PENALTY TO THE RATE. VA allows lenders to charge a 1% origination fee to do the loan for you but this is not required. Many veterans don’t realize this. To find out more about VA loans or to inquire about a No Cost VA loan, fill out our 45 second VA Loan Inquiry Form and a VA Loan Specialist will call you by the next business day.

The previous requirement was that the veteran would have to provide evidence that he or she was part of a traumatic event in order to be approved for VA benefits. The proposed rules are that there will be less evidence required making it easier and quicker for veterans to receive their benefits.

This is huge for veterans. Not only will they receive much deserved monthly VA benefits but in the VA loan perspective, this allows the VA funding fee to be waived as well. With the funding fee as much as 3.3% of the loan amount, the result of the rule change will allow literally hundreds of thousands of veterans to save THOUSANDS of dollars off their mortgages and lower their payments or even allow them to qualify for more.