Qualifying Veterans have used the VA benefit to purchase a home since 1944. It's one small way to say "thank you" for those who give so much to the country.
Veterans often use it hand in hand with our rebate program, allowing them access to a rebate equivalent to 25% of the commission that their real estate agent earns - that's $1,500 in a rebate check on a $250,000 home. The Allstar agents have already given back over $620,000 to clients in rebate checks!
Derek Prickett, a loan officer licensed in a few US States offers a free appraisal to a veteran who is getting a loan, as part of the Home For Heroes 'friends' program.
Sometimes a VA loan is not the best choice for every veteran. Be sure to chat with Derek (828-273-8071) or your lender about the best choice for you.
VA Mortgage Basics
A down payment is not required with a VA mortgage. Remember that this is not a 'saving' of money as is often stated, rather a way for a veteran to be able to purchase a home when they do not have funds available for a downpayment.
PMI, or Private Mortgage Insurance is payable when a borrower does not put down at least 20% on most home loans. The PMI is set in place to protect the lender. With a VA loan, there is no PMI requirement. This is a direct, significant saving on the monthly payment amount.
VA loans are partially guaranteed by the government, and usually offered at competitive rates and terms.
The home seller to a veteran buyer may pay part or all of the closing costs. The VA Administration states that up to 4% of the home’s purchase price can be used to cover the costs.
VA loans have a funding fee - the premise of the funding fee is to provide money to the Veteran Administration to continue offering the guarantee for future VA home loans. The fee is 2.15% of the home’s purchase price. If the veteran uses their VA benefit again, the fee increases to 3.3%. This fee does not have to be paid up front. The VA loan guidelines will allow the fee to be added to the total loan amount, thus giving the veteran the ability to pay the fee back over time. Surviving spouses and veterans whose income is derived from disability pay based on their service, currently receiving disability compensation are not required to pay the VA funding fee.
VA loans can also be used to refinance a property.
Eligibility for a VA mortgage
Active duty service men and women – a person must have served at least 90 days in the military during a time when the country is at war.
Active duty during peace – a person must have served at least 181 days as a full-time military personnel during a time the country was at peace.
National Guard or Reserves service – A person must have served at least six years in either the Reserves or the National Guard.
Surviving spouse – A person must be a surviving spouse of a person that either (a) perished while serving in the line of duty or (b) died due to a disability related to their service.
Rules change all the time - be sure to speak with a qualified mortgage professional who you trust. Notes herein are intended as an illustration only.