With Memorial Day’s passing, it’s a good time to cover the all-important topic of VA loans. Most people either currently serving in the U.S. military or who have served in the past are aware of the VA loan program and its benefits, but there are some facts they may not know about.
- Because VA loans are guaranteed by the U.S. Department of Veterans Affairs, lenders have the ability to offer excellent terms. In fact, a VA loan is often a better option than a conventional mortgage or FHA loan.
- You may be able to purchase a home with very little down payment – and in some cases no down payment at all with a VA loan. And as an added bonus, borrowers never have to pay private mortgage insurance (PMI) on VA loans, which can save you thousands over the life of the loan!
- You don’t have to be an active-duty or honorably discharged military service member to qualify for a VA loan. If you are a surviving spouse of a vet who died while on active duty or from a service-related disability; a member of the Reserves or National Guard; a U.S. Military, Air Force or Coast Guard Academy cadet; U.S. Naval Academy midshipman; or National Oceanic & Atmospheric Administration officer you may also be eligible.
- In addition to purchasing a single-family home, a VA loan can be used to buy a condominium or multifamily property with two, three or four units (as long as you will be residing in one of the units). Since VA loans can be used to purchase an existing home as well as new construction, you have the ability to buy directly from the builder.
- Contrary to popular belief, you can use your VA loan benefit more than once. After your initial home purchase, you can use the program to refinance your loan either on the same house or a different house. Moreover, you can restore your VA benefit by either paying off your existing VA loan or refinancing it into a non-VA loan. You can then apply for a new VA loan to purchase a new primary residence – keeping your first residence as either a rental or vacation property. A Cliffco Mortgage representative will be happy to explain this in greater detail.
- The VA offers a streamline refinance called an Interest Rate Reduction Refinance Loan (IRRRL) which doesn’t require an appraisal. Or you can opt for a full document refinance that would require an appraisal. This option would allow you to do a cash-out refinance if you have enough equity in your home.
It may be easier than you think to qualify for a VA loan. To find out if you are eligible, call (516) 408-7300 to speak with a VA-approved Cliffco Mortgage loan representative today.