Helpful Ideas To Understand VA Loans In Texas
What Are The Benefits Of VA Loans?
By applying for a VA loan, you can enjoy the following benefits.
1. No Down Payment
No down payment is required when buying a home with a VA loan. It is one of the loans where you don’t need a down payment. In 2018, 50% of homes purchased using a VA loan didn’t require a down payment.
2. No Limits On Borrowing
With a VA loan, there is no limit on the amount you can borrow. However, there is a limit on the amount of liability for the VA. In 2019, the VA can guarantee a maximum amount of 25% (up to a maximum of $121,087) for a home loan. It matches a maximum loan of $484, 350. If you apply for more than that, the extra amount will not be guaranteed by the VA.
3. No Private Mortgage Insurance
With a VA loan, you are not eligible to pay for a Private Mortgage Insurance because the loans are backed by the government. Note that, with a regular mortgage loan, PMI can vary from 0.5% to about 2.25% of the total loan amount. Therefore, if you took a loan amount of $200,000 and the PMI rate was 1%, you would be forced to pay an extra $166 every month for your mortgage payment.
4. No Minimum Credit Score Requirement
With a VA loan, there is no requirement for minimum credit scores. However, loan lenders give loans to people with a credit score of 620 and more. Having a lower credit score will definitely worry the lenders when it comes to giving you a loan.
5. Assistance For Possible Foreclosure
If you qualify for a VA loan, you will get assistance if you are on the verge of getting a foreclosure. The loan technicians will negotiate with the loan lenders on your behalf if you are having issues with meeting your mortgage payments.
6. No Prepayment Penalties
If you have the money to pay off the loan early, you will not be charged for it.
7. No Limit On The Times You Can Borrow
You don’t necessarily have to be a first-time homebuyer to get a VA loan. If you pay off the loan every time, you can apply for it as often as possible.
8. Bankruptcy & Foreclosure Are A Non-Issue
Have you ever filed for bankruptcy? Have you ever gone through a foreclosure? They are non-issues when it comes to VA loans. You can still qualify in both cases but after 2 years from the date of foreclosure or filing for bankruptcy.
That’s what you need to know about VA loans and how you can benefit when buying a home.
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