If you are a veteran of the U.S. Armed Forces, you should take advantage of the many financial options available to you. One of these benefits includes taking out a special loan at reasonable interest rates. But how does a VA loan work?
Mortgage lending services in Sacramento make it easy by offering this simple guide to understanding VA loans.
What Is a VA Loan?
A VA loan is a mortgage loan only available to military service personnel. These differ from conventional loans in many ways.
VA mortgages are generally more forgiving to those with lower credit scores. They are also government-insured, and veterans do not need to worry about a down payment.
This type of loan provides an excellent opportunity for new homeowners to get a jumpstart on financing. Unlike many conventional options that charge a fee, VA loans will not penalize you for paying off the mortgage early.
Now that you have a general idea about what a VA mortgage is and how it can benefit veterans, let’s go further. How does a VA loan work with the appraisal process?
To take advantage of a VA loan, you need to complete a VA appraisal. This process can cost you several hundred dollars and take a few weeks to finish. An assessment will ensure that the home listing is at fair market value.
VA appraisement works similarly to traditional appraisal methods. However, this is not a home inspection. If you would like to get a home inspection before moving in, you will need to consider that in your budget.
What to Expect Before Closing
It is essential to understand that you can only use a VA loan for your primary house. However, veterans can still use a second VA loan to cover the mortgages if they own another home. This perk is especially useful if they move to a new duty station.
You can reuse this type of loan as long as you pay off the existing one. Your mortgage is assumable to any buyer that is also VA loan eligible.
Keep an eye on your contract. Some VA loans allow the seller to assist in closing costs or debt repayments. These perks are not available with conventional plans.
Contact a VA Approved Lender
It’s time to start your VA loan by working with an approved lender. Many services are available to you, but veterans trust Anew Lending as their primary partner for loans.
Every year, our company helps thousands of veterans find the dream homes they deserve. Buyers always ask us, “how does a VA loan work?” We provide clear communication throughout the process, so expenses or other surprises do not catch you off guard.