Benefits of a VA Mortgage

The VA loan began in 1944 through the original Servicemen’s Readjustment Act, also known as the GI Bill of Rights. The GI Bill was signed into law by President Franklin D. Roosevelt and provided veterans with a federally guaranteed home with no down payment. This feature was designed to provide housing and assistance for veterans and their families, and the dream of home ownership became a reality for millions of veterans.

The VA mortgage is made by private lenders, such as banks, savings & loans, or mortgage companies to eligible veterans for the purchase of a home, which must be for their own personal occupancy. The guaranty means the lender of the VA Mortgage is protected against loss if you or a later owner fails to repay the loan. The VA mortgage guaranty replaces the protection the lender normally receives by requiring a down payment allowing you to obtain favorable financing terms.

The main benefit of a VA Mortgage is that there is no down-payment required to be made by the veteran. Other than USDA rural mortgages the VA mortgage is the last zero-down mortgage available in today’s market-place. Many times after serving  in the Armed Forces veterans quickly secure a good-paying job, but may lack the funds for a down-payment on a home. That’s where a VA mortgage really benefits our veterans that have proudly served our country.

The VA mortgage also has another great benefit for our veterans, there is no monthly mortgage insurance with this loan even those with zero down-payment. When looking at total montly payment having a loan with no monthly mortgage insurance like the VA Mortgage there is a monthly payment savings or the veteran can qualify for a larger home price than if using a conventional loan with mortgage insurance.

Though the VA mortgage can only be used on one home at a time the benefit can be re-used so long as the current VA mortgage is paid off. So the veteran can buy a home with a VA mortgage, live in it then when he sells it he can use his benefit for a new home with another VA mortgage.

If you are a veteran and thinking of purchasing a home, you would be remiss not to consider using the benefit you earned – the VA mortgage.

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