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5 Special Benefits a VA Loan Can Offer You

Happy family

Our military veterans have given so much to this country. Where would we be without these men and women who have sacrificed to protect our freedoms?

It’s only fitting that, to make it easier for these special families to qualify for and purchase a home, Veteran Affairs has a unique loan offer reserved only for retired and active military. The loan is still issued by private lenders, but it’s backed by Veteran Affairs and offers mortgage options unavailable to the general public.

Sound intriguing? It should! Here are 5 special benefits that military families can take advantage of when hunting for their first or next home.

No Down Payment

Zero-down loans disappeared in the real estate bubble of the last decade. Today, the average home buyer should expect to put down at least 5% to get a mortgage.

And yet VA loans allow our military to buy a house without the stress of trying to save the down payment. This is especially helpful since many military families may have to move abruptly and frequently.

Easier to Qualify

Banks take on less risk with a VA loan compared to a conventional loan. That’s good news for military families!

While most loans require a credit score of 650 or higher, there’s technically no credit score minimum required for VA loans. Typically, though, lenders still want to see you have a FICO score of 620 or higher. So keep that in mind.


PMI (private mortgage insurance) is required for any loan where the loan-to-value falls below 80%. This extra charge can range anywhere from 0.5% to 2% of your entire loan.

In other words, if you buy a house that’s $400,000 and you move forward with a 10% down payment, you would be required to pay mortgage insurance. If your PMI rate was 1%, that would add about $300 to your monthly payment.

But with a VA loan, you don’t even have to worry about that. Sounds nice, right?

Limits on Fees and Penalties

VA borrowers get extra protection with strict limits to fees and closing costs. Lenders financing a VA loan cannot charge more than 1% for loan costs whereas typical financing can run as high as 2.4–3%.

There’s also no prepayment penalty with a VA loan. Although it’s not common with mortgages, some private money lenders can impose a penalty if you pay off your mortgage early. (Sometimes thousands of dollars!) Thankfully, this isn’t legal with a VA loan.

These lower (or eliminated) fees can be a huge source of savings for military families.

Appraisal Assistance

At times, homebuyers run into problems when the appraisal does come back high enough to purchase the home at the agreed-upon price. This becomes an issue if the seller doesn’t want to lower the selling price.

When this happens, the VA can help by diligently reviewing the report and comparable properties and then asking the lender to adjust the appraisal if it determines that the value is not accurate.

The VA loan is a special loan program offered only to our active and retired military and widowed military spouses. These families have sacrificed so much for their country, the VA loan might be the only way these families can buy a home of their own.

If you or one of your loved ones has ever been in the military, we at Jessica Foote & Associates want to thank you for your generous service to our country! It’s our honor to serve our country’s military officers in the San Diego area.

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