What Is a VA Loan And How Veterans Purchase Properties Through It
Being able to buy a home as you work for it is a milestone in life. If you are a veteran or someone serving in the military, it can be a challenge. There is an option to buy a home if you are a veteran and that is with the help of a VA home loan in Massachusetts.
What is VA loan about?
A VA loan is a type of mortgage loan by private lenders that has the U.S Department of Veterans Affairs backing. It aims to help US veterans, widowed military spouses, and active duty service members to buy a home.
VA loans were part of the GI Bill in 1944 but have only caught the interest of many during the recent years. During the first quarter of 2019, more people have availed home purchases using a VA loan. This loan is easy to qualify to and you do not need a down-payment.
How a VA Loan Works
VA loans are not the same as the regular mortgage loan from banks because they are guaranteed by the government.
In VA loans, the government will repay a portion of the loan to the bank if you are not able to make the payments or in cases where you are about to get your house foreclosed. Banks have lower risks when it comes to a VA home loan in Massachusetts. Hence, it is easier to avail as long as you qualify for it.
How to get a VA Loan?
To qualify for this loan, the military personnel have to meet the requirements listed below.
- You must be an active duty service member with 90 consecutive days of service during wartime or 180 days of active service during peacetime. This also applies to military personnel who were honorably discharged.
- Have served more than 6 years as National Guard or the Selected Reserve.
- Spouse or partner of a service member who died in action.
- To apply, you need a Certificate of Eligibility (COE) to show to the mortgage lenders that you are eligible for a VA loan.
What do you get from a VA Loan?
Those who qualify and are approved for a VA home loan can enjoy the following benefits.
You do not have to make a down-payment in VA loans. Back in 2018, there have been many VA loans used to buy a house with zero down-payments.
Loan amount guarantee
There is no limit to the amount that can be taken as a VA loan. However, there is a limit to the liability the VA takes on. Beyond that limit, the VA is not guaranteed anymore.
PMI is not required
A VA loan does not require private mortgage insurance or PMI. PMI cost borrowers thousands for the duration of the loan. The absence of PMI can help save the borrower a lot of money.
There is no credit score requirement for VA loans but the lenders still look into a credit score.
If you want to enjoy the ease of getting a VA loan, it is best to find a good and reliable mortgage broker. Nextgen Mortgage is committed to put customers first and will be more than happy to assist you with your queries.