You’re seriously thinking about buying your first home—probably one of the biggest financial transactions a person may make. But how much money do you need for a down payment? Here are
What is a VA Loan?
Dated: October 3 2019
Whether you’re buying a condo for sale in Vero Beach, you’re looking for a single-family home for sale or you want to buy vacant land in Vero Beach to build your dream home, you could be eligible to use a VA loan.
What is a VA Loan?
A VA loan is a loan backed by the Veterans Administration. The loan itself doesn’t come from the Veterans Administration; it comes from a private lender, and the VA guarantees a portion of it.
The VA guaranty lets lenders know that if you default on payments, the VA will cover your lender’s losses (up to a certain amount).
Who Can Use a VA Loan?
Active-duty service members, reservists, and veterans are generally eligible for a VA loan. You must be in good standing with the military and, if you’re a veteran, you must have an honorable discharge from service to take advantage of the benefit.
In some cases, spouses and other dependents are eligible for a VA loan, as well.
You can check your eligibility for a VA loan here.
Benefits of a VA Loan
VA loans have several benefits, such as:
- No down payment, as long as the home’s sales price doesn’t exceed its appraised value
- No private mortgage insurance (PMI) premium requirements
- Limited closing costs (and sellers can pay your closing costs)
- Lenders can’t charge you early repayment penalties if you pay off your loan before the final payment is due
- Some help available through the VA for borrowers who have trouble making payments
Can You Get a VA Loan With Bad Credit?
While each lender has its own requirements, there’s no minimum credit score imposed by the VA for this type of loan. The VA requires lenders to look at the service members whole loan profile before making a lending decision, which can help veterans who wouldn’t otherwise be eligible for financing be able to secure it with this type of loan.
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Chip is the IT Manager for Alex MacWilliam Real Estate. He handles the technology needs of the company as well as helping agents in their day to day problem solving.....
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