If you have ever applied for a loan of any kind, shape, or size; you know that there are dozens of different types out there. For example; mortgage, personal, auto, etc. Within each different type there are also sub-loans that are offered. For instance within the lending arena for homes there are traditional mortgage loans, ARM-loans, and more.
There has been a lot of talk these days about VA loans and how they work, so I'm going to try and answer this questions in the simplest way possible below - What exactly is this kind of home loan and who qualifies for one?
The United States Department of Veterans Affairs guarantees all VA home loans. These loans may be issued by a number of qualified lenders. However, in order for the loan to be a true VA loan, it must be guaranteed by the U.S. Department of Veterans Affairs.
One way that the United States shows its appreciation to the vets of this country is to offer specialized VA home loans. VA home loans offer those who have served in the military the opportunity to be approved for a mortgage loan with little or no down payments. They may also be approved for 100% financing without having to find private mortgage insurance and U.S. Vets can be approved for larger amounts with a VA home loan than they can with a loan through Fannie Mae, for example.
So, who qualifies for a VA home loan then?
United States vets may qualify for these loans. Similarly, surviving spouses of U.S. veterans may also be approved for a VA loan. If a surviving spouse of a U.S. veteran remarries, he/she is no longer eligible.
If you are a U.S. veteran and are looking to purchase a home, it is beneficial to take advantage of VA loans. You will be eligible for better interest rates, better terms and better conditions for your mortgage loan.
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