Knowing how VA loans work is the first step toward getting the home of your dreams, and awareness is incredibly important when it comes to the VA loan.
A Department of Veterans Affairs survey back found that one-third of veterans didn’t know this benefit existed. Social media and a sagging housing market have helped more active military members and veterans to learn about homebuying and their options over the last four years. But there’s still more to do.
A VA-backed home loan isn’t the best option for every veteran, whether it’s a purchase or a refinance. But this program is almost always worth exploring.
I ended up with a pretty long list of facts after digging around but decided to keep it to a tight nine. Have a look, and please let me know if you have any questions or need help getting started on the path to homeownership with a VA loan.
82 percent of VA loans come with no down payment
Lenders typically require a down payment as a safety deposit, but because of the VA loan Guaranty, the majority of VA loan homebuyers enjoy the benefit of no down payment or private mortgage insurance.
Half of all VA loans are refinance loans
The VA home loan program offers two types of refinancing: For those with existing VA loans and for those who want to refinance an existing mortgage into the VA loans program. Hundreds of thousands of borrowers take advantage of low interest rates each year.
The average VA borrower has less than $9,000 in assets
This statistic comes from the VA’s annual benefit report for fiscal year 2015, which is the most recent report available. Veterans don’t need a mountain of cash in their bank account to secure a loan.
Veterans who’ve experienced bankruptcy or foreclosure can still qualify
There’s usually a two-year waiting period, although there are situations where a veteran who’s experienced a bankruptcy can be eligible for a home loan after just a one year. Read more about securing a VA loan after a foreclosure or bankruptcy.
VA loan volume has surged since the housing crisis
Three of the last five years have set new records for VA loan volume, including last year’s all-time record 707,000 loan guarantees. Veterans and military buyers have turned to this benefit in waves because of its huge benefits, from no down payment to more flexible credit underwriting.
Millions of veterans are still missing out
Despite the tremendous growth of the VA loan program, there’s still a significant gap in awareness about this benefit and what it offers. VA surveys show about 1-in-3 homebuying veterans didn’t know the VA loan program existed.
VA loans are leaders in foreclosure avoidance
According to a survey by the Mortgage Bankers Association, VA loans have been the safest lending product on the market for most of the last eight years, even with no down payment requirement. The program also places a premium on the financial health of its borrowers. VA loans have a unique requirement — residual income — that helps keep borrowers better prepared to meet their obligations.
The VA has helped more than 500,000 avoid foreclosure
The department urges VA lenders to work with borrowers to find solutions other than foreclosure. Those efforts have helped more than half a million veterans and military families keep their homes, saving taxpayers billions of dollars in potential foreclosure claims.
Some veterans qualify for property tax exemptions or VA funding fee refunds
Find out if you qualify for a property tax exemption in your state or if you are eligible for a VA funding fee refund. You can also talk with a Veterans United loan specialist at 855-870-8845 about your unique situation or click the button below.
Photo courtesy of Ryan Vaarsi