If you plan on buying a house in the near future, there are a few mortgage options available. One potential option is called a VA loan. This is a loan that has been backed by the Department of Veterans Affairs, and it could provide you with some added flexibility that you can use to purchase a house. Is a VA loan right for you? There are a few points to keep in mind.

Who Qualifies For A VA Loan?

First, not everyone is able to access a VA loan. This is a loan that is generally only available to active members of the US military, veterans of the US military, and surviving spouses of service members. There are different service requirements that you need to meet before you can qualify for a VA loan, so if you have questions about your service record, consider reaching out to an expert who can clarify whether you meet the requirements.

What Are The Top Benefits Of A VA Loan?

There are a few reasons why you might want to take advantage of a VA loan. First, you don’t need to put any money down. You can take out a home loan for 0 percent down, making it easier to purchase the house of your dreams. Second, even though don’t put any money down, you don’t need to pay for mortgage insurance, helping you save money. While you can still put money down if you would like, there is no requirement for you to do so.

Overall, the closing costs tied to a VA loan are significantly lower, so you don’t have to worry about exorbitant fees at the closing table. Finally, if you decide to pay off the loan early, you should not have to worry about incurring a prepayment penalty. 

Consider Applying For a VA Loan

There are a lot of unique requirements that you need to meet if you want to qualify for a VA loan, but it could help you buy a home without having to put anything down at all. You should partner with an expert who has experience navigating this situation. That way, you can find the best loan option to meet your needs.

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Members of the military, their family members, and veterans have access to a unique mortgage option called a VA loan. This can be a strong option because it provides borrowers with an opportunity to purchase a house for less than 20 percent down. While not everyone is eligible for a VA loan, there are a lot of people who are wondering, are VA loans assumable? There are a few key points to keep in mind.

What Is An Assumable Loan?

An assumable loan means that the buyer is essentially going to take over the mortgage held by the seller. Essentially, this means that the buyer is going to take over the remaining balance of the loan as well as the interest rate attached to that loan. The buyer will have to compensate the seller for any equity the seller has already accumulated. This means either providing the seller with cash for his or her equity or taking out a second mortgage to cover the difference. The biggest advantage of assuming a loan is that you may be able to secure a lower interest rate than you would in the current market. 

Who Can Assume A VA Loan?

The great news is that a VA mortgage loan is assumable. Even though a VA loan is only available to retired service members, active service members, and members of their immediate families, anyone the lender qualifies to take over the loan can assume it. In general, this means that the buyer needs to have a credit score of at least 580 and a debt-to-income ratio of 45 percent. The buyer and seller must also have at least 12 months without any missed payments. Finally, the person assuming the loan must also occupy the property and the buyer must be willing to take over the terms of the original loan.

Should I Assume A VA Loan?

Assuming a VA loan could be right for you because you can access a lower interest rate and potentially save thousands of dollars on closing costs and expenses if you do not have to take out a second mortgage. On the other hand, this also means that you might need to put more money down to compensate the seller for his or her equity. 

Filed under: Real Estate by Julie Woodward
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When you are applying for a home loan, you need to make sure that you meet the minimum credit score requirements. If you decide to go with a traditional loan, the credit limit can be high, making it hard to qualify for a home loan. In contrast, you might be able to qualify for a VA home loan with a much lower credit score. What do you need to know?

The VA Does Not Have A Minimum Credit Score Requirement

One of the major benefits of applying for a VA home loan is that you do not need to worry about meeting a minimum credit score requirement. There is no minimum credit score you need to qualify for a VA home loan, as there are lots of factors that the lender will consider when reviewing your application. Your credit score is only one factor. At the same time, you are encouraged to have a credit score between 580 and 660 to increase your chances of being approved for a home loan.

There Are Other Benefits Of Applying For A VA Home Loan

In addition to the lack of a credit score requirement, there are other benefits of applying for a VA home loan. For example, you do not have to worry about putting any money down. While you might be able to get a lower interest when if you decide to put money down, you are not required to do so. You also do not have to worry about paying PMI, even if you do not put 20 percent down. This is just another way that a VA home loan can help you save money.

A VA Home Loan Could Be The Right Option For You

With so many benefits of applying for a VA home loan, it makes sense to do so; however, you need to make sure that you meet the eligibility requirements. For this reason, you should work with a professional who can make sure you qualify for a VA home loan for your next purchase.

Filed under: Real Estate by Julie Woodward
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You may have more options than you think when it comes to securing a mortgage for your new home. While many buyers opt for conventional financing, another option or program might be a better choice for you, depending on your personal and financial situation. Learning more about FHA, USDA, and VA loans ensures you get the best possible deal for your mortgage and that you secure the loan that you need for your new home. Here’s what you need to know about these useful mortgage options.

FHA Loans
These are traditional mortgages that are backed by the FHA: when you take out an FHA loan, this government agency is insuring the loan. This makes your loan more appealing to lenders who might otherwise feel your credit or income history is not strong enough. An FHA loan is available to a wide range of buyers and price points and offers a low-down payment, reasonable interest, and other perks that make it worth exploring for your next mortgage. 

VA Loans
If you are a veteran then this program, which offers loans insured by the VA, is a great option for you as they do not require money down so you can buy immediately, rather than saving for years for a down payment. The VA loan is available to those who have served or are serving in the armed forces and is a good option to help you get the home you want with no money down, unlike a conventional mortgage loan.

USDA Loans
One of the most useful and often overlooked loan programs is from the USDA. While this government office offers direct loans, far more people qualify for their insured loan programs. USDA loans are for rural areas, but a surprising number of suburban communities and locations qualify as well. With a low-down payment and interest, this subsidized loan program is well worth it if you plan to live in a rural or suburban area. 

Not every borrower will qualify for the mortgage options above; the USDA has guidelines on income and the home you are interested in. The FHA does not have income requirements, but you will need to prove your income and this option also has a loan limit.  If you do meet the guidelines of any of the above programs, they can help you access the home you want by dramatically reducing your upfront and deposit costs. 

The right loan for you will depend on your income, credit, and the home you’ve selected. Your agent can help you find the home that suits the program you want and make it easy for you to secure the financing you qualify for. Get in touch today to talk about your home buying options and see which loan option is right for you. 

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When you’re buying a home, whether it’s a Port Royal condo or a house in El Pescador, you’re have several options if you don’t want to—or can’t—come up with a 20 percent down payment.

3 Big Programs That Allow You to Skip a 20% Down Payment

Let’s face it: Saving up 20 percent of a home’s purchase price can be tough. In some cases, it’s impossible.
Fortunately, there are three major programs that will allow you to buy a home with less than 20 percent down.

FHA Loans

If you take out an FHA loan, you could put down as little as 3.5 percent of the home’s purchase price. The program is designed as a “second chance” for people who have bankruptcies, short sales, and foreclosures in their pasts.

VA Loans

If you’re a veteran or currently serving member of the U.S. Armed Forces (and you’re in good standing) or you’re the surviving dependent of a vet or member, you could qualify for a VA loan. A VA loan, which is backed by the Veterans Administration, doesn’t require any down payment at all.

USDA Loans

Often called the “farmer’s loan,” a USDA loan is a rural housing incentive backed by the U.S. Department of Agriculture.

Are You Buying a Home in Port Aransas?

If you’re looking for a home in the beautiful city of Port Aransas, we’d love to help you.
Call us at 361-563-7788 or get in touch with us online to tell us what you want from your next home. We’ll begin searching right away.
While you’re here, check out our:

• All-in-one mortgage calculator
• Free homebuyer handbook
• Free eBooks about buying a home (and more!)

You can also check out:

• Port Aransas homes for sale
• Port Aransas condos for sale
• Port Aransas lots for sale
• North Padre Island homes for sale
• North Padre Island condos for sale
• North Padre Island lots for sale

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If you’re a veteran of the U.S. Armed Forces, you’re most likely eligible for a VA loan.
Unfortunately, many people aren’t aware of all the benefits that go along with a loan backed by the Veterans Adminstration—or even how they work.

VA Loans: The Basics

It’s not exactly accurate to call it a VA loan. The funding doesn’t actually come from the Veterans Administration; it comes from a private lender. We call it a VA loan because the VA guarantees a portion of it. (That includes the VA reassuring lenders that if you default on your loan, the lender can go to the Veterans Administration to recoup their investment.)

Benefits of VA Loans

If you choose to use a VA loan, the benefits include:

• No down payment required, as long as the home’s sale price doesn’t exceed its appraised value
• No private mortgage insurance premium requirements (most people have to pay PMI if they’re putting down anything less than a 20 percent down payment)
• The VA limits how much the lender can charge you for closing costs
• Sellers are permitted to pay your closing costs
• Lenders can’t charge you an early repayment penalty if you pay off your house before the length of the mortgage is up

Finally, if you run into trouble making your mortgage payments, the VA may be able to help you.

The Maximum Debt Ratio for VA Loans

There isn’t a maximum debt-to-income ratio for a VA loan. The lender does have to provide the VA with “compensating factors” if your DTI is over 41 percent, though. Many lenders have a maximum DTI, and in some cases, it’s lower than 41 percent.

Minimum Credit Scores for a VA Loan

The Veterans Administration does not have a minimum credit score requirement. Many lenders do, however.
Lenders must look at a veteran’s entire financial profile before making a lending decision, even if the vet’s credit isn’t as high as what the bank would typically require.

Are You a Veteran Buying a Home in Port Aransas or the Surrounding Communities?

Whether you’re looking for a home for sale in Port Aransas or North Padre Island, we’d love to help you find the perfect place to live.
Call us at 361-563-7788 or get in touch with us online to tell us what you want from your next home. We’ll start searching right away.
In the meantime, check out our:

• All-in-one mortgage calculator
• Free homebuyer handbook
• Free eBooks about buying a home (and more)

Filed under: Blog, Buying, Financing, VA Loans by Julie Woodward
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