No Down Payment Necessary
Traditional loans typically require a buyer to provide at least 10% of the home’s price as a down payment — and with today’s stricter lending environment that down payment can reach even 15% or 20%. For many first-time homebuyers, supplying this amount of money upfront may not be feasible. The VA Loan is one of the few programs in the country that does not require a down payment. Of course, borrowers who would like to lower their monthly payments are still able and encouraged to make a down payment that’s comfortable for them.
Less Stringent Qualifications
Many first-time homebuyers might not have a strong credit history, which can make it more difficult to get approval for a mortgage or qualify for an affordable interest rate. Since the VA Loan is government-backed, VA Loans are easier to qualify for at competitive rates.
Lower Monthly Payments
Since VA Loans don’t require the added monthly expense of private mortgage insurance (PMI), they tend to leave more money in your pocket each month. In addition, the competitive VA Loan rates can save a typical buyer thousands over the lifespan of the loan.