VA Home loan
03-15-2011, 12:26 AM
#1
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VA Home loan
I am quite possibly going to buy my first home pending this job, I have no idea where to start I am a veteran so I know I qualify. Has anyone/or does anyone have a VA loan? Pros/Cons where do I start, what do you pay a month etc.
I have good credit as well, above 730 on all 3. Thanks!
I have good credit as well, above 730 on all 3. Thanks!
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03-15-2011, 08:17 AM
#2
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when I checked into it years ago, I got better rates going with conventional - BUT that is when the market was good. Now at days, a VA loan may very well be easier to get approved over a conventional HL
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03-15-2011, 10:34 AM
#3
The biggest advantage to a VA loan is no down payment required, and no PMI required. PMI is extra insurance that lenders require from most homebuyers who obtain loans that are more than 80 percent of their new home's value. In other words, buyers with less than a 20 percent down payment are normally required to pay PMI. PMI will continue to be payed until you've payed down 20% of the prinipal.
Instead of PMI, a VA loan will require a 1-time Mortgage Funding Fee.
The VA funding fee is required by law. The fee, currently 2.15% on no down payment loans for a first-time use, is intended to enable the veteran who obtains a VA home loan to contribute toward the cost of this benefit, and thereby reduce the cost to taxpayers. The funding fee for second time users who do not make a down payment is 3.3%. The idea of a higher fee for second time use is based on the fact that these veterans have already had a chance to use the benefit once, and also that prior users have had time to accumulate equity or save money towards a down payment. The good news is, that this fee can almost always be rolled into the loan, so the buyer does not have to come up with the cash up front.
Other than that, it's basically a regular loan. Almost every loan entity has VA loans. We got ours through a broker. If you don't have a bank already picked out, then a broker who will find you a loan is a good option. Our Real Estate agent had a mortgage broker who worked in our building and that's who we went with.
Original loan was $360k with the funding fee rolled into the loan. 30yr fixed at 6%. This was in November of 05. We refinanced last year at 5%, cost us about $4500 out of pocket, but only because we refi'd with the same bank. If we'd tried to refi with another bank using our same VA loan, the house would needed to have been reappraised... and it's currently worth about $280k. We're near $60k upside down, and couldn't have secured the refi.
If you want to learn everything you really need to know about buying a house, get "Mortgages For Dummies'... yes, one of the little yellow books at Borders everybody laughs at. If you really are a dummie, they're brilliant reads for a 95% solution. "Homebuying for Dumies" is good too... takes you through inspections, escrow, fees, etc...
Instead of PMI, a VA loan will require a 1-time Mortgage Funding Fee.
The VA funding fee is required by law. The fee, currently 2.15% on no down payment loans for a first-time use, is intended to enable the veteran who obtains a VA home loan to contribute toward the cost of this benefit, and thereby reduce the cost to taxpayers. The funding fee for second time users who do not make a down payment is 3.3%. The idea of a higher fee for second time use is based on the fact that these veterans have already had a chance to use the benefit once, and also that prior users have had time to accumulate equity or save money towards a down payment. The good news is, that this fee can almost always be rolled into the loan, so the buyer does not have to come up with the cash up front.
Other than that, it's basically a regular loan. Almost every loan entity has VA loans. We got ours through a broker. If you don't have a bank already picked out, then a broker who will find you a loan is a good option. Our Real Estate agent had a mortgage broker who worked in our building and that's who we went with.
Original loan was $360k with the funding fee rolled into the loan. 30yr fixed at 6%. This was in November of 05. We refinanced last year at 5%, cost us about $4500 out of pocket, but only because we refi'd with the same bank. If we'd tried to refi with another bank using our same VA loan, the house would needed to have been reappraised... and it's currently worth about $280k. We're near $60k upside down, and couldn't have secured the refi.
If you want to learn everything you really need to know about buying a house, get "Mortgages For Dummies'... yes, one of the little yellow books at Borders everybody laughs at. If you really are a dummie, they're brilliant reads for a 95% solution. "Homebuying for Dumies" is good too... takes you through inspections, escrow, fees, etc...
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03-15-2011, 06:12 PM
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Sam's on target.
Some reading here: http://www.va.gov/ won't hurt either.
Stopping in at the local VA offices will also get you a wealth of information.
Some reading here: http://www.va.gov/ won't hurt either.
Stopping in at the local VA offices will also get you a wealth of information.
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