Know Your Mortgage: VA Loans

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I’m not a military man, but many members of my family are. I admire anyone who has the courage to enlist, and it’s not to say I couldn’t serve if the situation was dire enough, but I just don’t think I’m a “soldier” kind of guy. Aside from all that, my strategy as a little brother has always been to play possum or cry as defense, so I don’t think you’d want me in your fox hole. Consider the amount of pull ups I’ve done since freshman year gym class (somehow, in the negatives) and you understand I’d totally be that guy in boot camp; that guy needs three people to push him over the wall in the obstacle course. The point I’m trying to make is veterans earn every post-service perk that they can get their hands on, one of the best ones being VA loans. What’s a VA loan you ask? Great time to ask that, because I’ve been searching for a proper transition into the topic for this week’s Know Your Mortgage: VA Loans.

Before we get going here, what’s a VA?

The “VA” part of VA Loans stands for Veterans Affairs, as in the loan is guaranteed by the U.S. Department of Veterans Affairs. A VA loan isn’t just for veterans though, it can go to reservists, surviving spouses and active-duty members.

So the military gives away cheap mortgages only veterans can get?

Yes and no. First off, it’s not the military giving away cheap mortgages. Any lender can offer a VA loan and they all come with perks like no money down when purchasing a home, refinancing up to 100% of the home’s value, jumbo VA loans up to nearly $1.1 million in certain states, and lower credit scores are okay depending on certain variables.  This also includes no private mortgage insurance payments and generally less red tape for the home buyer to cut through.

So I have to get it in some crazy 14.3 year ARM/Fixed rate hybrid, right?

Not at all. VA Loans are available in any loan options that civilians have whether you want 15-year fixed rate, 5-year ARM, they’re all available under VA loans with the discounts and perks that were mentioned above, if you are eligible for them of course.

There’s got to be a catch though right? There are too many good features about VA Loans.

Did you forget the whole “being a current or former member of the military” stipulation?

Oh…right.

Yeah, so there’s that. But other than that it’s an honest to goodness attempt to help our veterans. It was first introduced back in 1944 as part of the Serviceman’s Readjustment Act, and has been tweaked, revised and expanded on many times since then. The important legacy of VA loans is that over 18 million off them have been insured by the government, with more all the time.

Interesting.

I know, right? Anymore questions?

Nah, I’m good.

It’s getting easier every week to help people understand their mortgages. To put it briefly, VA loans are the same as the ARM and fixed-rate loans you’ve heard of in the past, but with better deals. If there’s any further confusion on the topic, or if you’re a visual learner, watch this informative video with the Zing Blog’s very own veteran writer (in the experienced sense and the “he’s-a-veteran” sense) Clay Closson.