Military veterans have access to low-interest home loans through the US Department of Veterans Affairs (VA). The VA has said that they a. supported record-breaking 1.2 million loans in 2020, and a new study suggests it is already well on its way to breaking that record again in 2021.
Both average consumers and military veterans have been able to avail of home purchase and mortgage refinancing at low interest rates. VA refinance loans increased 76% in the first half of 2021 compared to this point in the previous year, and demand for VA purchase loans increased 10% over the same period. according to a new study by Veterans United Home Loans. The study also analyzed the top cities for homebuyers in VA to see where veterans are moving to.
Read on to learn about trends in the housing market among seasoned home buyers and how to get a VA loan to refinance or buy a home. And if you are unsure of your creditworthiness, You can visit Credible to connect with experienced loan officers and get your mortgage questions answered.
Veterans across the country are taking advantage of the VA home loan
Military veterans are entitled to a number of benefits, including VA home loans. These loans do not require any down payment or payment private mortgage insurance (PMI), which is usually required when you are not filing money. VA loans are also forgiving when it comes to Debt-Income Ratio (DTI) and minimum credit requirements so they can be an option if you have decent credit or bad credit.
After completing their military service, many veterans take advantage of these VA home loan benefits by settling in sunny climates, the study found. The No. 1 metropolitan area for VA loan growth is Honolulu, Hawaii, where loan activity nearly doubled year over year. Retired military personnel also seek the warmth of the south and flock to states like Texas and Alabama.
In addition, the study showed that veterans are taking out more VA loans in the capital of our country and in the surrounding areas. Here is a list of the top 10 cities for VA loan growth:
- Washington, DC
- Baltimore, Md.
- Fayetteville, NC
- El Paso, Texas
- Virginia Beach, Virginia.
- Montgomery, Ala.
- Little Rock, Ark.
- Huntsville, Ala.
- San Antonio, Texas
Veterans don’t just take root in new places; Many are taking advantage of their claim to refinance their existing loans with a VA loan at a lower interest rate, the study says.
Mortgage rates are currently generally low on VA loans as well as conventional mortgages, which is a good time to find a home financing regardless of military status. And with real estate values rising at a rapid pace, it may be a good time for borrowers to get additional home equity Cash-out refinancing.
If you are thinking of buying a home or refinancing your current mortgage, your options should be explored by visiting the online credit marketplace Credible.
Eligibility Requirements for VA Refinancing and Home Loans
- You will have at least 90 consecutive days of active service in wartime and 181 days or less in peacetime if you were discharged for a disability.
- You did not do active service for 24 months or less in the 1980s or 1990s if you were fired because of a service-related disability.
- You are the surviving spouse of a veteran killed, missing, or prisoner of war on duty.
- You have served in the National Reserve or National Guard for 90 days of continuous active service or 6 years of service.
When applying for a VA loan, you will need to provide a Certificate of Eligibility (COE) so the lender knows you are eligible for this program. Your COE may be a copy of your discharge papers or a signed certificate of service, depending on your military status.
As with a traditional mortgage, a VA loan requires you to buy a habitable home that meets the minimum property requirements. You need a VA certified home appraisal to confirm the home’s worth.
It can make sense to take out a conventional mortgage
Although the advantages of the VA home loan are significant, it is important to consider the disadvantages. VA loans can only be used to purchase a primary residence, so you cannot use one to purchase a secondary residence. Holiday home or investment property. Also, the VA financing fee can add thousands to the cost of your mortgage.
If you opt for a traditional home loan instead, you may only be able to save 3%. And since Mortgage rates near historic lows, you can likely get a low interest rate even without taking out a VA loan.
Military veterans should try their best financing options when buying a home, so it is important to consider mortgage offers with multiple private lenders and loan types. You can Prequalify for a conventional mortgage on Credible in minutes to see offers tailored to your needs without compromising your creditworthiness.
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