In the current economy, many homeowners have not been doing well. Homeowners who cannot make their monthly mortgage payments are becoming delinquent on their mortgages and facing possible foreclosures on their homes.
But in the midst of the mortgage crisis, the VA loan program has still been successful. VA loans, which are exclusively available to veterans and men and women serving in the military, provide multiple benefits to borrowers that enable them to finance their homes and stay grounded in the struggling home market.
VA Loans Have Low Delinquency Rates
This type of financing remains a popular option for qualified applicants who want to finance their home in an affordable way. In 2009, the Department of Veteran Affairs guaranteed 325,673 VA loans, proving that the bad economy was no match for the program. These loans have a delinquency rate of only 5 percent.
This is quite low when compared to the delinquency of other types of home loans, which are as high as 30 percent! This shows that the VA must be doing something right with its home mortgage program to be able to maintain such a low delinquency rate.
Why VA Loans Continue to Be Successful
VA loans offer many benefits to both current homeowners and prospective homeowners that allow them to save money upfront and over the life of the loan. This type of financing is unique in that it does not require borrowers to make a down payment on purchases. Many lenders are reluctant to offer this type of incentive because they consider it to be risky in this unstable housing market. The elimination of the down payment saves first-time home buyers thousands of dollars in out-of-pocket costs, which allows them to have more money for other expenses associated with buying a home. Homeowners who already have a mortgage can refinance their loan into a VA loan to receive a lower rate, pull cash from their equity, or consolidate their debt!
Currently, VA mortgage rates are at historic lows, which makes now a great time for individuals to get a VA loan. Compared to other types of home loans, these loans can offer even lower rates. With a low rate, homeowners can reduce their monthly mortgage payment and have more money available for other expenses. This type of financing also does not require mortgage insurance, so borrowers can save even more money over time.
Eligible Applicants Should Take Advantage of This Great Opportunity
This type of financing is also easy to use because it has lenient credit and income requirements; applicants do not have to have perfect credit to be eligible. This is good news for those who may have been turned down for a conventional loan. Applicants will need to have a credit score of at least 620, and they must have gone one year without any delinquent payments.
If you’ve considered financing with a VA loan to receive a low rate and save money, don’t hesitate to call us. Our office makes it simple. We have a team of knowledgeable loan officers who have helped many veterans through the mortgage process.