Using a VA loan to buy or refinance a primary residence is one of the greatest benefits available to our more than 21 million veterans and active-duty servicemembers. Sadly, only 6 percent of them have taken advantage of a VA home loan in the past six years.
Why do so few military take advantage of the program? Many eligible veterans don’t see VA loans as a viable option for several reasons, including thinking they won’t qualify, the process is arduous or they don’t know how the program works.
Here are five important facts about VA loans most veterans don’t know about:
- Buy or refinance: The VA loan benefit is not just for first-time homebuyers. It’s true that its homebuying advantages are unmatched, but the VA also offers refinance and home equity loans. Some loan products allow veterans to refinance without an appraisal or without providing employment or income verification.
- No mortgage insurance: While it’s pretty common knowledge that VA loans require little to nothing down, most borrowers don’t realize that low- or no-down-payment VA loans do not require private mortgage insurance (PMI). This is a benefit no other low-down-payment loan products offer.
- Surviving spouses may be eligible: In 2015 alone, more than 3,000 surviving spouses purchased a home with their fallen partner’s VA benefit. As long as the surviving spouse hasn’t remarried, the husbands and wives of soldiers killed in action can buy a home with no down payment and no mortgage insurance.
- Easier to qualify: Unlike most mortgage products, VA loans don’t deny borrowers with low credit scores. And bankruptcies and foreclosures do not disqualify you from using a VA loan. While individual lenders will put their own overlays on credit requirements, the VA guidelines do not state a minimum credit score. Call us for more information on using a VA loan with poor credit.
- Buy income property: As long as you plan to live at the property, the VA will back loans on properties up to four units. This means you can rent out the other units to help cover your monthly payment and even make some extra income.
The VA loan program is one of the best, most underutilized benefits available to our veterans today. For more information on VA loan qualifications to talk about your loan options, call us today at 888-320-7888.