Nick, & Cindy Davis

VA Loans and Housing Programs

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As an element of its mission to serve the nation’s military members, the U.S. Department of Veterans Affairs provides several housing benefits to service members as well as their families, including assistance with home loans. If you or someone close to you has a military affiliation, it’s best if you understand the resources available.

 

5 Points to Understand About VA Loans and Housing Programs

5 Points to Understand About VA Loans and Housing Programs

 

Here’s an overview.

Who’s eligible: Current service members, veterans and eligible surviving spouses of members of the armed forces can take advantage of VA home loan guaranty benefits along with other housing programs.

The VA’s role in the mortgage process: Unlike what you may assume from the name, VA loans are offered by private lenders such as banks and mortgage companies, not the VA. The VA guarantees a portion of the loan, allowing private lenders to provide better terms to borrowers.

The advantages of VA loans: They typically include no down payment, no required private mortgage insurance (PMI), an established limit on the amount vets can be charged for closing costs and possible assistance from the VA if the homebuyer has trouble making payments. “If the buyer’s agent is able to negotiate for the closing costs to be covered by the seller, they may not have to bring any money to the closing table,” say Mario Negron, Broker/Owner of RE/MAX Pioneers in Cypress, Texas.

The fees that come into play: As outlined by Robert Wolfe, a loan originator with and part owner of Motto Mortgage Apex in Beavercreek, Ohio, veterans financing their home through the VA are required to pay a 2.15% funding fee (Note: This is set to increase to 2.3% in 2020), which increases with multiple uses of VA loan benefits. A down payment helps to reduce the required funding fee, and a veteran is exempt from any funding fee if they have a 10% or higher VA Disability. “The funding fee is more of an issue for subsequent users, or those reusing their VA loan benefits,” Wolfe says. “But subsequent users are often selling their current home, so they have the ability to have a down payment. A down payment of 5% or more, on a subsequent use, can substantially lower the required funding fee.”

The family benefits too: Spouses and children of service members also make sacrifices while a loved one serves in the military. The advantages that come with financing a home through utilizing a VA loan may mean the family is able to purchase a bigger home or purchase in a stronger school district. “Many veterans can qualify for 10% to 20% more home simply because they save the extra monthly expense of PMI that is required on a minimal-down conventional and FHA loan,” Wolfe says.

To find out more about the resources available through the U.S. Department of Veterans Affairs, visit their website at http://www.benefits.va.gov/homeloans/. Some states provide additional home-financing resources to eligible veterans, such as reduced property taxes. You can find out more here: http://www.va.gov/statedva.htm.

Nick & Cindy Davis are not only experienced Realtors, we are both Retired from the US Army and love helping fellow veterans and their families navigate through the VA loan process.

Ready to find your new home here in the Tampa Bay and Surrounding Areas? Nick, Cindy & Nicholas Davis with RE/MAX Premier Group are here to assist you with all your Real Estate Needs. We are always available at 813-300-7116 to answer your questions or you can simply click here and we will be in touch with you shortly.

Need to get started with your mortgage process? You can contact Kyle Edwards with Iberia Bank at 813-495-5131, or simply click here to start your online application.

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