What
is a VA Loan?
Veterans Administration (V.A.) Loans are available to qualifying
MIA (Missing in Action) spouses, United States veterans, and their
surviving unmarried spouses (providing the veteran was killed in
service or from a service related injury or disability.) The
government is not the lender, but they guarantee the loan, making it
less risky for the lender.
The amount that is guaranteed is 25% of the maximum loan amount,
which is called the Veteran’s entitlement. When the loan is repaid,
the entitlement amount is reinstated.
The veteran does not pay for this guarantee, and he or she is
prohibited from paying any of the VA points. The VA points can be
paid by the seller, or another party. There is a 1% loan origination
fee, and a 1% funding fee. Only the latter may be financed.
The borrower can borrow up to a specific amount, with no down
payment. If the sales price exceeds that, the buyer must come in
with a 25% down payment for the excess amount. Under some
circumstances the borrower may borrow money to use as a down payment.
When the property is appraised, the V.A. will issue a Certificate
of Reasonable Value (CRV). If the borrower would like to purchase a
property whose price exceeds the CRV, he or she must pay cash for
this extra amount.
Unlike a FHA loan, the borrower in a VA loan must occupy the
property. VA Loans tend to have more lenient underwriting rules, and
offer fixed or adjustable rates. There are no prepayment penalties
with VA Loans.
For more information on VA Loans, contact your VA approved lender.
Other Links of interest
http://www.havasumagazine.com/RE/FHALoans.htm
http://www.havasumagazine.com/RE/conventionalloans.htm
http://www.havasumagazine.com/RE/Buying.htm
http://www.havasumagazine.com/RE/Selling.htm
http://www.havasumagazine.com/RE/loans.htm
http://www.havasumagazine.com/RE/VALoans.htm
http://www.havasumagazine.com/RE/FAQ.htm
http://www.havasumagazine.com/RE/Interest.htm
http://sanerealestate.com/Mortgage.htm
