VA guaranteed loans are made by lenders and guaranteed by the U.S. Department of Veteran Affairs (VA) to eligible veterans for the purchase of a home. The guaranty means the lender is protected against loss if you fail to repay the loan. In most cases, no down payment is required on a VA guaranteed loan. Interest rates are comparable to conventional loans.
Other benefits of a VA loan include:
- Equal opportunity for all qualified Veterans to obtain a loan
- No down payment (up to the Freddie Mac loan limit for the county where property is located.
- Buyers informed of reasonable value.
- Negotiable interest rates.
- Limitations on Closing costs.
- Mortgages are assumable.
- Long amortization (repayment) terms.
- No private mortgage insurance requirement.
- Mortgage can be taken over (or “assumed”) by the buyer when a home is sold.
Although mortgage insurance is not required, the VA charges a funding fee to issue a guarantee to a lender against borrower default on a mortgage. The fee may be paid in cash by the buyer or seller, or it may be financed in the loan amount.
A VA loan can be used to buy a home, build a home and even improve a home with energy-saving features such as solar or heating/cooling systems, water heaters, insulation, weather-stripping/ caulking, storm windows/doors or other energy efficient improvements approved by the lender and VA.
Veterans can apply for a VA loan with any mortgage lender that participates in the VA home loan program. A Certificate of Eligibility from the VA must be presented to the lender to qualify for the loan.
For further information about VA loans, please give me a call, Sherry Bitner - 941-504-1445 or email me at Sherry@SherryBitner.com