As interest rates continue to rise, there’s more and more incentive to apply for a VA home loan. While some people believe VA loans involve too much red tape, a simple cost comparison will show that dealing with a little more bureaucracy can save you thousands in the long run.
But since we specialize in VA home loans, we have streamlined the process in order to save you time and money. We help families all across the country save money on purchase, refinance and construction loans backed by the VA every year.
Here are a few things to consider when deciding between a VA home loan or a conventional loan:
- DOWN PAYMENT: In today’s lending environment, banks are still heavily regulated by the federal government, meaning no- and low-down-payment home loans are nearly extinct. Except for the VA loan. Because the government backs VA loans, lenders do not require a down payment.
- MORTGAGE INSURANCE: Most lenders require buyers to pay mortgage insurance, or PMI, when putting less than 20 percent down on a home. However, borrowers using a VA home loan are not required to pay PMI, saving homeowners hundreds, if not thousands, of dollars a year.
- INTEREST RATES: Interest rates are on the rise. But veterans have an advantage. Since interest rates are calculated based on risk, VA loans typically carry lower interest rates than conventional loans. This is because the federal government is assuming some of the risk through its guarantee.
- QUALIFYING: Today, lenders require more and more documentation in order to underwrite loans. Because VA loans are backed by the government, the approval process is less stringent. This means VA loans are easier to obtain than traditional financing.
Now that you’re ready to take the next steps to buy or refinance a home, we hope this information makes your decision process a little easier. If you have any questions at all about how VA loans work, call us today at 888-320-7888 for a no-hassle consultation.