VA Loan

VA Loan

VA loans through the U.S. Department of Veterans Affairs are available to qualified veterans and military members. The VA does not make loans, but insures loans made available to veterans. The VA guarantees loans made by us to give veterans better rates and terms.

The VA Loan Guaranty Program was put in place in 1944 to help veterans returning from war afford a home. Over 18 million veterans have since used the program. Along with offering loans to buy a home, a VA loan can be used to refinance a VA loan, take cash out of a home, repair or improve an existing home, make energy efficient improvements, and much more.

VA Loans

Eligible borrowers for a VA loan include:

  • Active duty military personnel
  • Veterans
  • National Guard and Reservists who have served for a minimum of six years
  • Spouses of military members killed in the line of duty, as well as those rated totally disabled or eligible for compensation prior to death

To get a VA loan, the borrower must first get a Certificate of Eligibility from the Department of Veterans Affairs. This certificate states that the borrower has a VA entitlement and can participate in the program. A VA-approved lender can help a borrower obtain the form, or the veteran can request it online.

VA Mortgage Program

Advantages of a VA Loan

VA loans are very popular because they do not require a down payment and underwriting standards are looser, compared with conventional mortgages. About 80 percent of VA borrowers could not qualify for a conventional home loan.


 
  • Low, competitive interest rates
  • No down payment necessary
  • No private mortgage insurance (PMI), regardless of down payment size
  • Looser credit, income and debt requirements
  • Available to eligible borrowers with a prior bankruptcy or foreclosure
  • No prepayment penalties
  • Seller can pay up to 6 percent toward closing costs
  • Streamlined refinancing available
  • VA funding fee can be financed *Surviving spouses who get a VA loan do not need to pay the funding fee
  • Loan is assumable
Department of Veterans Affairs

VA Loan Cost

Most veterans can obtain a VA loan without a down payment or paying closing costs out-of-pocket, but a VA funding fee must be paid.
This funding fee will be charged on every VA loan.


 

Regular Military Members

  • 2.15 percent funding fee with no down payment
  • 1.50 percent funding fee with a down payment of 5 to 9.9 percent
  • 1.25 percent funding fee with a down payment of at least 10 percent

Reserve and National Guard Members

  • 2.4 percent funding fee with no down payment
  • 1.75 percent funding fee with a down payment of 5 to 9.9 percent
  • 1.50 percent funding fee with a down payment of at least 10 percent

VA loans are the best loan option for most people who qualify, especially those with a lower credit score or income. The VA mortgage program is one of the best available with very low interest rates, looser underwriting standards, no private mortgage insurance, and no need to put any money down.

VA Loan Cost

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