What are VA loans?
By Mark Lambie
VA loans are basically mortgages or home loans geared towards
ex-military servicemen and women. The VA loan programme
was created in 1944, and was initially known as the Servicemen's
Readjustment Act, to help returning servicemen settle down and
purchase their first home.
There are, on average, over twenty-five million American who
complete their military obligations each year. You are eligible for
a VA loan if you are veteran who has been honourably
discharged. The eligibility requirements vary, depending upon
whether you served full-time or in the reserves, so check with
A VA loan will generally guarantee around 25% of the total
home loan, up to $89,912.00. VA loans are often made by a
variety of lenders, such as banks and savings and loans
institutions. These loans act more as protection for the lender
against loss at a later date.
There are many advantages to taking out a VA loan, if you are
eligible to do so. For example, the fees associated with taking
out a VA loan are relatively inexpensive. Most lenders only
require approximately 2% of the total loan, but bear in mind that
you will still be required to pay some of the associated costs, such
as recording fees and appraisal and compliance costs.
Even if you have poor credit, you may still be eligible to apply for
a VA loan. The lender will initially analyze your credit history,
checking to make sure that you have been making all of your
credit and utility payments on a regular- and timely- basis. Even if
you have been delinquent, you can still be eligible, but you may
have to work with the lender and will most likely be required to
make a down payment for your home.
VA loans are generally a good idea for those who have just left
the military, because it allows them to start the resettlement
process by buying their own home. These loans are usually easy
to apply for, and don't require a hefty down payment, as required
by traditional mortgages. Technological developments have made
the whole process easier, by allowing some applications to be
processed by the lender immediately, making these readjustment
loans a great way to start your civilian life.
About the Author
Mark Lambie is the founder of The Loan House a website that allows consumers to quickly and easily get home equity mortgage information.
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