USD of Veterans Affairs approved Loans
A VA loan is a type of mortgage loan that is guaranteed by the U.S. Department of Veterans Affairs. VA loans are such loans for which VA pledges to repay about a quarter of every loan it approves in case the borrower defaults. Such a firm guarantee gives VA-approved lenders more protection when lending to military borrowers.
Thus, it is considered to be one of the most powerful and flexible lending choices available today and often leads to very competitive rates and terms for qualified veterans.
Major Benefits of VA Loan
The most significant benefit of a VA loan is that it empowers the borrower enough to purchase with no money down. It's very hard to find another such lending option today that provides borrowers with 100% financing apart from the government's USDA's Rural Development home loan and Fannie Mae's Home Path.
VA loans require less stringent underwriting standards and requirements than other conventional loan types. If analyzed carefully, we would find that almost 80% of VA borrowers could not have qualified for a conventional loan. Also, these loans do not require private mortgage insurance (PMI), a monthly amount to be paid by a conventional borrower unless they put down a minimum of 20% of the loan amount.
Salient Features of USD of Veterans Affairs approved Loans or VA loans:
No (0%) down payment required
No penalty applicable on prepayment
Allows higher debt-to-income ratios than other conventional loans
Streamlined refinancing loans that require no additional underwriting
Competitive interest rates that usually remains lower than conventional loans rates