Mortgage approval can be one of the biggest hurdles for some homebuyers. Conventional mortgages have strict standards, and lending fees can be high. However, you might be eligible for a VA home loan if you or your spouse is an active service member or veteran. The benefits of VA loans make them very attractive.
This post will explore the benefits of using a VA loan to buy a home.
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As of August 2023, the median list price of homes in Lexington, SC, was $330,591. It is important to remember real estate trends change frequently. If you need help buying a home around Lake Murray in South Carolina, click here to contact us.
The Department of Veterans Affairs does not issue VA loans. Instead, they back the loans and set the terms and requirements. Not all lenders offer VA loans, and they are only available to qualifying military service members and spouses.
The following are some benefits borrowers can expect from VA home loans.
Many consider this one of the most attractive benefits. In some cases, the loan can fund up to 100% of the purchase price of a home. That means you might not need any down payment to buy a home. It makes homeownership more accessible to qualified borrowers.
Interest rates are often lower on VA loans than comparable conventional mortgages, so you would have lower monthly payments to service the loan. Lower interest will save the borrower a lot of money over the life of a 30-year mortgage.
Many home loans require mortgage insurance. You’ll need mortgage insurance with an FHA loan or a conventional mortgage with a down payment under 20%. The insurance not only increases costs at closing but also adds to costs over the life of the loan. With a VA loan, you won’t need mortgage insurance.
Closing costs are a part of buying a home and they can run a few thousand dollars depending on various factors. While you can’t escape them entirely with a VA loan, the VA sets limits on some fees.
Beyond the down payment, some other financial requirements are less stringent than conventional home loans. For example, they allow a higher debt-to-income ratio. Many lenders also have lower requirements for the borrower’s credit score.
Do you need real estate services in the Lake Murray area? Click here to contact Southern Dream Realty. We are local experts that can help with buying, selling, or property management. Reach out now to learn more.
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