offer a large number of servicemen or women great advantages in the mortgage market. These loans offer $0 down payment options that have helped millions of military members secure homes; however, even some of the people using the VA loan program do not know all of the different benefits and regulations of a VA loan.
VA Loans Are Reusable
VA mortgages are not a one and done kind of benefit. As long as the previous VA loan was paid off in full, you can get a new VA home loan. Even if circumstances lead to foreclosure on an earlier VA loan, you may still be able to qualify for a new one.
VA Home Loans Can Only Be Used on Certain Kinds of Houses
Unfortunately, the home that you buy cannot bring in any kind of income. This may seem silly and inapplicable; however, this rule would prevent you from purchasing a working farm. The VA loan will also only cover homes that are ready to move into. This means that you cannot buy a more affordable, slightly run-down home that needs some maintenance and fixing. The homes that you can purchase must be single-family houses or condos.
VA Loans are Only Good on Primary Residences
You cannot use your VA benefit mortgage to buy vacation housing or investment properties. The VA home loans are for just that, homes. These benefits are specifically set aside for primary residences. You can use the benefit to purchase multiunit housing as long as you live in one of the units as your main housing. Sometimes, the VA will allow exceptions.
The Veteran’s Administration Does Not Lend VA Loans
The does not actually issue the mortgages for this program; however, they do guarantee them. This means that they agree to back the loan for the lender. Usually, the VA will back up to a quarter of the amount you borrow. This makes the lender you are working with feel more comfortable and allows them to offer less strict requirements and better rates, than traditional mortgages, to the service men and women who qualify.
You Can Obtain a VA Mortgage Regardless of Previous Bankruptcies or Foreclosures
Even if you have a history of foreclosure or bankruptcy, you can still qualify to get a VA loan. The regulations for VA loans are different, and that allows for some exceptions for VA qualified borrowers.
VA Loans Do Not Require Private Mortgage Insurance
Private Mortgage Insurance is an amount in addition to your monthly house payment that helps to protect the lender if you ever default on the loan. Lenders typically require this fee if you pay less than 20% toward a down payment. Because the VA is guaranteeing these mortgages, the lender does not have to protect themselves in that way. This allows for VA loan holders to have smaller monthly house bills than they would have had with a typical mortgage.
The VA Funding Fee
Though there is no mortgage insurance required with a VA loan, there is a fee assessed by the VA called the “VA Funding Fee.” This money maintains the program and has to be paid upon purchase of a new home as well as every time the mortgage is refinanced. This fee can be added as part of the loan to be paid over time or waived altogether if the borrower has service-related disabilities.
VA Loans Require Other Signers to be Your Spouse or Another VA Qualified Borrower
If the service member needs to have a co-borrower, he or she must be the service members spouse, or they must also qualify to receive the VA home loan benefit. If the co-borrower does not meet one of those requirements, they would be required to make the typical down payment, and some lenders will not allow a non-qualified co-borrower at all.
VA Loans Can be Paid Off Without Penalty
Unlike a traditional loan, with a VA mortgage, you can make additional payments when you can afford them to help you save on interest in the long run. Most loans penalize you for not keeping the full length and full interest owed. However, those fees are not allowed with the VA loan benefits.
NHL Lending and Your Fort Lauderdale VA Loan
Here at Nationwide Home Loans, we offer many different loan types. We are a qualified VA lender in , with VA loan experts. Our team is trained and experienced in all the regulations that surround VA mortgages. We can help you find out if you qualify and see if you are preapproved. Through our home loan , we can get you set up to buy the home of your dreams today.