Friday, November 22, 2013

FHA Loan Or VA Loan?

By Darrel Jefferson


Sometimes the benefits of being a soldier seem never-ending. Discounts and free education on top of compensation. And the benefits do not stop when it comes to home loans, either. If you or your spouse have served or are currently serving in the armed forces, you may be eligible for a Veterans Affairs mortgage, more often referred to as a VA Loan. It may not seem like that much of a benefit in comparison with the work that those in the armed forces are asked to do. Or if you have lost a loved one in the armed forces it can in no way make up for that loss. However, the United States hopes to contribute what they can to the lives of those who fight for our freedoms.

So, what do you need to know about FHA and VA loans? What are the pros and cons of each, and how do you know which one is better? Well, like I said before, loans are complicated creatures, but let me simplify each of these for you so that you can make an informed decision.

If you are in active duty and have been serving for more than 90 days, you are eligible for a loan. If you are a veteran and previously served in either World War II, the Korean War, the Vietnam War, or the Gulf War for at least 90 days, you are eligible. Or if you did not serve in the wars but served for 181 consecutive days post-war, you are also eligible for the loan.

If you are the unmarried spouse of one that has died in service, you and your family are also eligible for the VA loan. If they have gone missing in action or have become prisoners of war you may also receive a VA loan.

On these loans, you will be able to get a loan with as little as no cash down with no monthly private mortgage insurance (PMI). That alone has the potential to save a family hundreds each month and thousands over the life of the loan. Qualifying standards are more relaxed, while the fees and other costs are much more flexible than other loans.

While VA loans are available expressly for military personnel and their families, if you qualify to apply, there are several reasons you should seriously consider it. First, VA loans allow you to finance 100% of the home, meaning that there is no down payment for the home you are purchasing, freeing up any out of pocket money to spend on purchases for your move. Additionally, VA loans do not require mortgage insurance and the financial qualifications are quite relaxed when compared to other types of home loans. On top of everything else, VA loans are typically accompanied by some of the lowest interest rates available on the market.

The amount of your loan can vary depending on where you live and whether or not it is a high-cost area. It can also depend on your credit score, but not as heavily as it might otherwise. Different lenders require different scores, so be sure to check before applying.

Whether you qualify for a VA or FHA loan, it is important to take a serious look at your current and projected finances, consult with trusted professionals who can give you good advice, and then make an educated decision based on what you need.




About the Author:



1 comment:

  1. In this post comparison of FHA loan or VA loan have so much information. For the eligibility of a VA home loan, the essay services thing to perform is research. Every kind of package possesses have its cons as well pros.

    ReplyDelete