The veteran mortgage is just one small perk that can be provided to those veterans who have served the country. Veteran mortgages attempt to make life for veterans easier by providing them exclusive benefits. Veterans need to be informed of these benefits and understand the great perks they provide. Listed are four of the major benefits of a veteran mortgage.
1. Competitive rates – Veteran mortgage loans have negotiable interest rates. The interest rates one can obtain using a veteran mortgage are generally going to be lower than the average citizens. Saving the 3-5% fee of the total loan in closing costs makes a substantial difference. Most veteran mortgages do not require down payments either which save a lot on the initial cost of purchasing a home. The number of benefits included in a veteran mortgage are substantial and should be taken full advantage of.
2. Leeway – The customer does not have to pay private mortgage insurance (PMI), which can save a ton of money. The average PMI rate per $100,000 loaned is around $55 a month. With $200,000 financed, one can save around $1,300 a year. Credit scores are not as big of an influence in a veteran mortgage as they would be in a normal one. Lenders typically only consider the past 12 months when reviewing a potential clients credit. Veteran mortgages provide a little more wiggle room for the lenders which directly help the consumer.
3. Peace in the future – When refinancing a mortgage, one can bypass having to qualify again for a new rate and avoid the extra paper work. A veteran mortgage also allows one to use 100% of the houses equity to take cash out, consolidate debt, or even pay bills. There is no penalty for late fees within 15 days of the due date and no penalties for payments made early either.
4. Easy to obtain – The main form to obtain is the Department of Veterans Affairs Certificate of Eligibility VA Form 26-1880. This loan isn’t limited to just veterans, certain individuals in active duty, reservists, National Guard, and certain spouses are eligible for this great benefit. After you have received your certificate of eligibility, you can contact a veteran mortgage lender and have them take you over the next steps in the process of acquiring a loan. 25 million people are believed to be eligible for this benefit, therefore check to see who is qualified. Veteran mortgages are not handed directly to borrowers and one has to find a lender that qualifies with the veteran administration to provide them.