When it comes to purchasing a residential property, there are numerous home loan options available for veterans. Ironically, due to the variety available, many lenders find it a challenge to make the right decision, especially in the absence of an expert assistance. Even with professional assistance, it is important for veterans to have a basic knowledge about the various types of home loan available in the US. Let’s get into the details of the various types of veteran home loans available in the US.
Introduced in 1944 under the Federal Servicemen’s Readjustment Act, a VA loan is exclusively available to individuals who served the country and some selective military spouses. Some of the advantages of VA loans that make it ideal for veterans, are low-interest rates and zero down-payment. Whether a veteran or an active duty service member is in Texas or any other state, he can apply for the VA loan, if he meets the eligibility criteria.
Administered by the U.S. Department of Agriculture, the USDA loans are for citizens including the veterans with low income who wish to purchase a house or land in a rural area. It is important that the property is located in the predefined eligibility zone to qualify for a USDA loan.
Citizens, including veterans, may use Federal Housing Administration (FHA) loans to purchase property or maintenance work on a property. There are other types of FHA loans for senior citizens, first-time home buyers, and the individuals who want to buy a property and introduce energy efficient improvements in the property. The “no down payment” options are not available for FHA loans, and borrowers need to pay mortgage insurance up front and on a monthly basis.
If a veteran finds that a VA loan is not an appropriate, he may apply for a conventional loan. These loans are similar to any other conventional mortgage options, but the veteran still needs to meet the military service requirements.
A Few Last Words
VA loans are a profitable option among the multiple loan options available to veterans. The loan is not only useful for purchasing a property, but it is ideal for refinancing too. Veterans do not need to make a down payment if they are applying for a VA home loan and the credit score requirement is also low, as compared to the other loan options available to the borrower. It is advisable to seek the advice of a VA loan expert, to make a better decision because financial condition plays a vital role in improving or lowering the living standard of an individual as well as his family.