VA LOANS

The VA loan remains one of the few mortgage options for borrowers who don’t have the money for a down payment. Available to millions of veterans and active military members, VA loans are somewhat easier to qualify for than conventional mortgages.

Eligibility

Most members of the military, veterans, reservists and National Guard members are eligible to apply for a VA loan. Spouses of military members who died while on active duty or as a result of a service-connected disability may also apply.

Active-duty members generally qualify after about six months of service. Reservists and members of the National Guard must wait six years to apply, but if they are called to active duty before that, they gain eligibility after 181 days of service.

Reservists, members of the National Guard and active-duty members generally are eligible after 90 days of service during war periods.

Advantages of a VA loan:

• Interest rates are generally a little lower than those of conventional loans
• No down payment needed (if the purchase price doesn’t exceed the appraised value)
• No private mortgage insurance required on loans of more than 80% of a home’s appraised value
• Strict limits on closing costs
• No minimum credit score required
• No prepayment penalty for eliminating your mortgage ahead of schedule