By Andria D. Rall
Many veterans wish to maximize their home-purchasing power and buy as much home as they can comfortably afford. Unfortunately, conventional financing is not designed with the veteran borrower in mind. This dilemma is easily fixed with VA loan rates. Historically, VA loan rates are lower than conventional loan rates by half to one-percentage points. If you?re not interested in doing the math, this could mean the ability to qualify for a $200,000 home loan instead of a $180,000 home loan!
Interest rates for veteranloans are very competitive in the current economic environment. While service members typically earn less than private sector employees do on average, veteran loan interest rates help level the home-purchasing arena. So, why are VA interest rates much lower than conventional mortgage rates? The logic for this is simple: VA interest rates are backed by the Veteran?s Administration Department. Naturally, banks are more inclined to write VA mortgage loans because a part of these loans is risk-free.
Service members who qualify can use loan proceeds for many of the following reasons:
Up to a specified loan amount, build a new house or purchase an existing home. These loan limits are dependent upon the region in which the residence is purchased. For the purpose of VA mortgages, the term home includes residential condominiums and manufactured residences with or without a lot.
Make repairs, alter or improve an existing residence. Certain home improvements are allowable in conjunction with the home purchase, including energy-efficient improvements and improvements to manufactured home lots.
Refinance an existing home loan to either reduce the interest rate or liquidate a portion of the home?s equity. Refinance proceeds can be distributed in cash, or used to purchase a manufactured home lot in certain instances. An additional benefit of the VA refinance is that there is no requirement for the existing financing to be a VA-guaranteed loan. For additional information concerning loan limits or cash-out, refinancing restrictions, contact a VA-approved lender.
Install a solar heating system, install a cooling system, or weatherize a home.
All of these options make the VA loan a win-win situation for everyone. If you plan to purchase a home in the near future, take the time to educate yourself on VA options. Consult with a VA loan expert or visit the Veteran?s Administration website to learn how you can become a veteran homeowner. And remember: At the end of the day, VA loan rates are competitive and help service members borrow more and save more!
Extremely easy and saves you thousands of dollars during the life of your loan. So check out va loan rates as well as va loan requirements.
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