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The housing market has been difficult to predict for many years now, but as we start to see something of a recovery a lot of home buyers are choosing to use the VA home loan program to secure the financing they need. With mortgage rates already at historical lows, this may already be a good time to consider buying a home, and with the added benefits of the VA program, it is possible for veterans to find a great home that fits their budget.

VA home mortgages are available to most active military personnel as well as veterans or surviving spouses. It has been a very attractive program because it may allow these people to get more flexible loan terms, lower down payment requirements, and get reduced mortgage rates compared to the average conventional loan.

Financial Benefits of VA Mortgages

The VA does not, in fact, make loans to people. Mortgage loans must still be made by financial institutions, whether it’s a bank, credit union, or some other private mortgage broker. Where they differ from a conventional loan is how the VA guarantees the loan, protecting the lender from excessive losses from buyers who default.

This kind of guarantee comes with a number of benefits, most notably: the ability to acquire a loan with no money down and the chance to receive 100% financing (up to the VA loan limits) on the home.

No down payment can make it much easier for a veteran to secure financing even when they don’t have a large lump sum saved up. This opens up a lot of options and reduces restrictions on the size and style of home for which the veteran can qualify. As long as the home appraises for its purchase price, the buyer will be able to get financing for the home’s full amount.

It is also important to note that, whether you make a large down payment or get a loan with nothing down, there will not be an annual mortgage insurance payment. This is also a large benefit for many home buyers since it can significantly reduce the monthly costs for the home.

Take Advantage of Lower Rates

Military personnel who are eligible can take advantage of the current low mortgage rates through the VA Home Loan Guarantee. The underwriting process for these loans follows a different set of guidelines than conventional loans and this provides an opportunity for buyers to secure a low-rate, low-payment combination that opens a lot of possibilities for many veterans.

A VA loan can be used for the purchase of 1-4 unit, owner occupied homes, townhomes, and condos, and there is even a refinance program (IRRRL) that allows you to improve your loan situation without appraisals, income verification, or credit score check. There are a lot of advantages that make a VA mortgage extremely appealing in the current market.

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