While the G.I. Bill helped millions of veterans go to college, VA loans make it easier for them to buy a home. Here's what you should know about VA loans.
How VA loans work in general
The VA doesn't give out home loans to veterans, just like HUD doesn't. Instead, it makes it easier to get home loans by making sure that lenders will get the full amount they loaned back. This keeps lenders from having to worry about the loan not being paid back.
In exchange for the VA guarantee, lenders make it easier to get a loan and make it much less expensive to buy a home. In many cases, the borrower won't have to make a down payment or will only have to make a small one. The borrower won't have to pay private mortgage insurance either, which is something that non-military borrowers usually have to do when they make less than a 20% down payment.
The guarantee amount is one thing that might be bad about a VA loan. At the moment, the most you can get is $203,000. This amount is not enough to buy a home in many parts of the country. As the programme is changed from time to time, veterans should contact their local benefits office to find out what the current guarantee amounts are.
A person must meet a few general requirements to get a VA loan. They must have been in the military, that much is clear. In particular, you must have been on active duty during or after World War II and not have been given a bad discharge. Those who serve during wartime must have done at least 90 days of active duty. Those who served during times of peace must have done 180 days of service. Veterans who served after 1980 must have served for at least two years, unless they were on active duty during one of the Gulf Wars. In this case, the amount of time is 90 days. It's clear that it gets a little confusing. Make sure to talk to the office in your area to find out if you qualify.
VA-backed loans are great ways to get the money you need to buy a home. When a veteran wants to get a mortgage loan, they should look to them first.
