What advantages are there for applying for a VA loan compared to a conventional loan?

Asked by newheights10, Greensboro, NC Wed Jun 12, 2013

I am self employed spent four years in the military

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Emily Franco, Agent, Greensboro, NC
Wed Jun 12, 2013
Well one advantage is certainly no down payment! The last VA loan I closed, the buyer actually walked away from the table with money! I'm working another VA right now with someone who had several options and chose the VA route. A lower interest rate is quite possible as well. Let me know if you want to explore this option further, I know a lender that can get you VA approval in as little as a day!
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Tom Bailey, Agent, Greensboro, NC
Wed Jun 12, 2013
There are distinct differences between VA and Conventional loans as well as significsant advantages for buyers who qualify for a VA loan.

1. Because a VA loan is backed by the federal government, banks do not require a down payment.

2. A VA loan do not require PMI ( private mortgage insurance). PMI would kick in for a conventional loan if the buyer has a down payment of less than 20%.

3. Banks will also offer a lower interest rate to a VA borrower ( typically 0.5%-1.0 % reduction vs conventiuonal). A lower rate combined with no PMI can substantially lower your monthly payment.

4. Because the VA loan is backed by the goverment, banks assume less risk and have less stingent standards making them easier to obtain.

I hope this information helps.
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