What is a VA home loan exactly? Well, they are also known as Veterans home loans. They are special loans offered to veterans, active duty service members, and some surviving spouses that allow them to get a loan for a new home with no up-front cost. In this video, you will learn how these VA loans work.
These loans are generally easier to qualify for and offer better terms. Application for a VA loan can be either during or after service. One stipulation is that this new home must be your main residence. One of the main benefits is generally lower interest rates. This is because the lenders are guaranteed the money. The other main benefit is no initial down-payment. However, this blessing can also be a curse because it means taking out a larger loan leading to more interest down the line. Therefore, it is recommended to place a down payment if at all possible. As part of the loan, an appraiser will charge $400-$500 to appraise the property. There will also be a one-time fee of 0-3.3% of the price of the home depending on the length of your service time and the down payment. As you can see, there are both pros and cons to VA loans. To find out if VA loans are right for you, consider contacting your local mortgage lender.