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VA Loan Benefits: Get a Higher Mortgage Rate with No Points

Dec 7

VA Loan San Diego is one of the most powerful mortgage options available for active military, veterans, members, and their spouses who survive them. There are numerous financial advantages that the VA loan provides that aren't available in other mortgage types. These advantages, when compared with other credit options, are a major reason why the VA Loan San Diego volume is substantially higher than in the last 15 years.


Do you really need a VA loan?


This historical benefit program has been an enormous help to thousands of veterans, military families, and military personnel. Since the Great Recession, VA loans have seen an exponential rise in their use and have become one of the most sought-after mortgage choices.


Let's take a closer look at the best benefits of the VA loan.


1. There is no deposit required


The VA loan's primary benefit is that eligible Veterans are able to purchase homes without having to pay a down payment. This benefit lets military and veterans purchase homes without having to put aside money for years or pay traditional lump-sum installments. You can determine if you are eligible for the VA loan San Diego without any money down.


FHA loans require the payment of a 3.5 percent down payment. Conventional loans typically require the use of a 5.5 percent down payment. An FHA loan will require $8,700 cash and $12,500 for the traditional loan required for a typical mortgage of $250,000. These are substantial amounts for a typical military borrower.


2. Private mortgage insurance isn't available.


PMI insurance safeguards mortgage brokers from default. A majority of traditional lenders will require applicants to pay monthly mortgage insurance unless there is a down payment of 20. This is something many veterans cannot attain. Traditional borrowers must pay this monthly cost until their homes have reached 20 percent equity. FHA loans require a monthly payment of the FHA mortgage insurance.


VA loans aren't subject to monthly mortgage insurance, in contrast to conventional or FHA loans. Since there isn't private mortgage insurance, those who took out a VA loan within the last year can save thousands on mortgage insurance over the course of the loan's duration.


3. Competitive Interest Rates


The VA loan program is also affordable for Veterans since it has the lowest fixed rate available.


The data obtained from ICE Mortgage Technology show that VA loans have the lowest 30 years fixed rate on the market in the last six years. VA loans are characterized by rates of interest that are typically 0.5 or 1 percent less than traditional loans. Veterans are able to save money each month, and throughout the loan's duration, they can enjoy lower interest rates.


4. Credit requirements are now eased


Since it is the one who oversees the loan program and it doesn't make loans in the first place, the Department of Veterans Affairs doesn't set credit score minimums. The majority of VA mortgage brokers utilize credit score benchmarks to assess the likelihood of default for borrowers. While they might be less than traditional loans, the requirements for credit scores may differ.


For a low-interest rate and home, loans Veterans don't need to have excellent credit. VA loans can be more flexible in getting back on track following a bankruptcy, foreclosure, or short sale.


Although closing costs and fees are part of every mortgage, however, the VA restricts the amount Veterans are able to charge. The deal must contain charges and fees that are paid by third parties. These steps help ensure that homeownership is affordable to those who are qualified buyers.


VA borrowers are entitled to ask that the seller cover all closing costs, as high as 4% in concessions, taxes prepaid as well as insurance, collection, and judgments.

Dennis Sakofsky C2 Financial Corp

2001 Peridot Court, Carlsbad, CA 92009

(619) 391-3707