Millions of veterans and service members are eligible for a VA home loan. When searching for a mortgage, veterans should consider the major benefits and perks of using a VA home loan.
VA Loan Benefits
The greatest VA loan benefit is that Eligible homebuyers are not required to have a down payment in most cases - compared to conventional loans which generally require a least a 20 percent down payment.
No monthly mortgage insurance premiums or PMI to pay. FHA loans come with both an upfront and an annual mortgage insurance charge. Conventional buyers typically need to pay for private mortgage insurance unless they’re making a down payment of 20 percent or more.
Limitation on buyer's closing costs. Sellers can pay all of a buyer’s loan-related closing costs and up to 4 percent in concessions.
Lower average interest rates than other loan types. VA loans continue to have the lowest average interest rates of all loan types.
No prepayment penalties. VA buyers can pay off a loan early without any financial penalties.
Two refinance options. The VA loan program allows homeowners with existing VA loans the option to lower their monthly payment with a new interest rate. Eligible homeowners who financed their property with a loan other than a VA loan can refinance into the VA loan program.
Foreclosure avoidance advocacy. The VA loan program has staff members who advocate on behalf of homeowners to find alternatives to foreclosure.