8 Big Benefits of VA Loans

May is when we celebrate our nation’s service men and women through Military Appreciation Month and Memorial Day. But Atlantic Bay wants you to know how great U.S. Department of Veterans Affairs (VA) Loans are every day of the year. VA Loans are geared to help our nation’s qualified military, veterans, and surviving spouses achieve homeownership, and their benefits are countless. Here, we go over the basics, as well as perks you may not know about! 

The Savings Start Early 

The savings that can come with VA Loans start the moment you apply. They come with: 

• No down payment (but you can still use down payment assistance programs for closing costs!) 

• No mortgage insurance 

• No loan limits or purchase price limits for borrowers with full entitlement 

VA Loans do require a “funding fee,” an upfront payment VA borrowers make to help offset the loan’s cost to taxpayers. But the funding fee is still typically lower than a down payment, and you can roll it into the loan, rather than pay it upfront at closing. And there’s more good news… 

New, Lower Funding Fees 

As of April 7, 2023, VA purchase, construction, and cash-out borrowers will pay 0.15-.3% less in funding fees, depending on down payment and first or subsequent use. If you’re considered 10% or more disabled, the funding fee is waived.    

Better Rates   

Interest rates for VA buyers are typically lower than for FHA or Conventional financing. Veterans can also qualify for higher debt-to-income ratios (DTI)The percentage of your gross monthly income that is used to pay your monthly debt and determines your borrowing risk.debt-to-income ratios (DTI)The percentage of your gross monthly income that is used to pay your monthly debt and determines your borrowing risk. compared to other loan programs, as long as they meet residual income requirements (the money left over each month after you pay your mortgage and all major expenses). 

Generous Credit Score Minimums 

The U.S. Department of Veterans Affairs requires a minimum score of just 580, but lender requirements will vary. Atlantic Bay accepts VA applicants starting at 600 – but we can consider special circumstances. No matter where your credit stands, we would love to help you get where you need to be through guidance and rescoring.  

Vets Can Pay for the Termite Inspection  

Why is this cost a benefit? It gives you negotiating power. Previously, military borrowers could not be charged for this required inspection (around $100), which could cause frustration in the contract negotiations and closing. Now you don’t need to worry about your contract being rejected due to the seller’s being responsible for the inspection. Vets can pay for moisture inspections, too.   

PS, the VA does not require standard home inspections. But they’re recommended unless the home is new and under builder warranty.  

Multiple Loans, Multiple Uses 

VA Loans can be used more than once, and borrowers can carry more than one VA Loan at a time. Also, two unmarried Veterans can split eligibility.    

Combine Your VA Loan with Other Programs 

As we mentioned before, you can use down payment assistance programs to help with your closing costs. If you’re a first-time homebuyer, you may be able to receive additional benefits from your state housing agency (Atlantic Bay can help you find out). Also, real estate taxes are waived for 100% disabled Veterans.  

Atlantic Bay Offers E-Closings 

Finally, no matter where you’re stationed, we can work with you and the seller to do all or most of your paperwork and closing remotely!   

Atlantic Bay is honored to help military borrowers achieve their dream homes. Reach out today to get started.