More than 21 million Veterans and Servicemembers sleep in the U.S. today, but only about 6 percent of them bought a home employing a VA home equity credit within the past five years. That percentage might be much higher.
Eligible Veterans often bypass the program as a viable option for a variety of reasons.
First, they’ll not know all the benefits. Second, they’ll think getting a VA loan is an arduous process to be avoided. Last, some lenders don’t take the time to show Veterans about the program or don’t know much about it themselves. The VA home equity credit may be a program non-military home buyers wish that they had access to.
My advice: take a couple of minutes to find out these 10 facts about the program, and you’ll about ditch the other home buying or refinance option.
- No deposit, no mortgage insurance
These are perhaps the most important advantages to a VA loan. You don’t need a deposit. None whatsoever. Most mortgage programs, like FHA and traditional loans, require a minimum of 3.5 percent to 5 percent down. That’s up to $12,500 on a $250,000 home purchase.
With a VA loan, you’ll buy it immediately, instead of years of saving for a deposit. With a VA loan, you furthermore may avoid steep mortgage insurance fees. At 5 percent down, private mortgage insurance (PMI) costs $150 per month on a $250,000 home, consistent with PMI provider MGIC.
With a VA loan, this buyer could afford a home worth $30,000 more with an equivalent monthly payment, simply be eliminating PMI. employing a VA loan saves you money upfront, and tremendously increases your buying power.
- Use your benefit again and again
Your VA home equity credit benefit isn’t a one-and-done. you’ll use it as repeatedly as you would like. Here’s how.
Assume you bought a home with a VA loan. But now, you’ve outgrown the house and wish something bigger. once you sell the house and pay off the VA loan completely, you’ll re-use your benefit to shop for another home. Your entitlement is restored fully.
But that’s not the sole thanks to re-using your benefit.
Eligible Veterans and Servicepersons can receive a one-time restoration once they pay off the VA loan but keep the house. This scenario comes into play if you bought the house way back, and have paid off the loan. It also applies if you’ve got refinanced the VA mortgage with a non-VA loan.
In these cases, you’ll keep the house, and luxuriate in the advantages of VA home buying another time.
- Your benefit never expires
Once you’ve got earned eligibility for the VA home equity credit, it never goes away. those that served 20, 30, even 50 years ago often ponder whether they will still buy a home today if they never used their benefit. If eligibility is often established, the solution is yes.
Eligibility is predicated on the length of your time served, and therefore the period during which you served. as an example, a U.S. Army Veteran with a minimum of 90 days in commission during the Vietnam era is probably going eligible.
To check eligibility, first, obtain your DD Form 214. thereupon document, a VA-approved lender can request your VA Certificate of Eligibility for you, otherwise, you can request it directly from VA’s eBenefits website. you’ll be eligible to shop for a home employing a VA home equity credit, albeit you served way back.