Home Loans California & Arizona

Purchase a home in Rancho Cucamonga with NO money down!

May 26th, 2012 5:04 PM by Nathan Rufty

The VA loan program was first introduced after World War II. This special program was created in order to assist veterans in obtaining financing for the purchase of a home. The VA home loan program provides veterans with more opportunity to own their own homes. The VA does not issue mortgages or lend money. Instead, the VA guarantees mortgages, therefore protecting the lending institution against loss incurred if the borrower of the loan defaults. It is because of this guarantee that VA loans can be easier to obtain. There are several reasons why VA home loans are a terrific program.

Advantage 1 - No Down Payment

One of the first reasons is that a down payment is not required for VA loans. This is great for a veteran who wants to purchase a home, but does not have the cash on hand to make a down payment. A veteran does not have to worry about making a large down payment, but if he or she prefers, a small down payment can be made. By making a down payment of five percent or more, a veteran lowers the amount of the basic funding fee that is charged.

Advantage 2 - No PMI Insurance

A second advantage to VA mortgage loans is that there is not a requirement for private mortgage insurance. Generally speaking, if a veteran pays less than 20% down on a conventional home loan, he or she will have to pay private mortgage insurance until there is 20% equity in the home. On a VA loan, private mortgage insurance is not required. This is one of the reasons why a VA home loan may be preferred over a conventional home loan.

Advantage 3 - Competitive Interest Rates

A third advantage to obtaining a VA loan is that VA loans offer competitive interest rates. This is one of the best advantages to a VA loan. Many lending institutions offer low or newton payment loans with higher interest rates. Since a VA loan can be obtained with no or little money down at a competitive interest rate, these loans offer great financial incentives for a veteran looking to borrow.

Advantage 4 - Seller pays VA             non-allowble fees charged to the loan

The qualified Veteran can not pay certain fees charged on the loan and it is sometimes up 90% of the fees charge, which means the Veteran in a lot of cases will receive their earnest money deposit back.

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Posted by Nathan Rufty on May 26th, 2012 5:04 PM

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