In addition to being one of the country’s leading lenders to first-time home buyers, Michigan Mortgage specializes in helping veterans of the United States military and their families get into their dream homes.
Veterans Affairs (VA) mortgages make it easier for veterans to obtain financing for home ownership. VA loans are available to veterans and active military members. VA loans are guaranteed by the Department of Veterans Affairs and are somewhat easier to qualify for than conventional mortgages.
VA Home Loan Benefits
VA loans are great because:
- They can be obtained without any down payment.
- Mortgage insurance is not required even if you put less than 20% down.
- The VA does not require a specific credit score for a VA loan.
Although the costs of getting a VA loan are generally lower than they are for other types of low-down-payment mortgages, VA loans do carry a one-time funding fee that varies depending on the down payment and the type of veteran.
According to the VA, veterans who have taken advantage of the program have some of the lowest home ownership default rates, and that the agency also helped 80,000 VA borrowers avoid foreclosure in 2014, saving taxpayers $2.8 billion.
VA Loan Requirements
VA loans are offered to most active duty, reserve or National Guard and veteran service members and even some surviving spouses.
Veterans are able to borrow over $400,000 without any down payment on a principal residence home. According to the VA, almost 90% of VA loans have no down payment.
There’s also no minimum credit score requirement for a VA loan, while most home mortgage loans require a credit score of at least 620 for conventional loans or 580 for most FHA loans. A VA loan can also be used to refinance an existing loan.
VA loans do have specific requirements that most other loans don’t. For instance, all work on the home must be completed before the inspection. Also, there can’t be chipped or peeling paint inside or out, or termites or mold or loose handrails. In other areas, a VA inspection can be a bit more stringent. For example, while most home inspectors merely turn on the home’s furnace to see if it works, the VA requires inspectors to verify that the heat source can keep pipes from freezing.
This blog post was written by experts at Mortgage 1 and originally appeared on www.mortgageone.com. Michigan Mortgage is a DBA of Mortgage 1.