Reasons Why VA Loans Are On The Rise
Posted by Frank Roccuzzo - The Roccuzzo Mortgage Group at Oct. 10, 2019
By: Crystal Catuara Garcia| Mortgage Loan Originator, Barrett Financial Group|NMLS 1690462
The VA home loan program was not designed to help rich people finance mansions. While there is no official maximum loan amount, there is a limit to what the federal government will guaranty. Most (but not all) lenders use the same formula: for loans over $144,000, the maximum loan amount is four times the amount of the VA’s guaranty
VA purchase and refinance loans are increasing in popularity. That’s because they offer significant advantages over any other type of mortgage:
VA mortgages require no down payment
There is no mortgage insurance with VA home loans
100% financing- VA loans have no maximum loan amount
VA mortgages are fully assumable. They can be taken over by any qualified buyer (who does not have to be a veteran). The VA or your lender must approve assumption in advance.
VA offers the Streamline VA-to-VA Interest Rate Reduction Refinance Loan (IRRRL). These refis require no credit qualifying, appraisals or income verification.
Fannie Mae and Freddie Mac only allow three percent seller concessions for high-LTV loans but VA loans allow sellers to pay up 4% concessions. These contributions can go toward closing costs and discount points, but not your down payment, if you choose to make one.