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Current VA Home Loan Interest Rate
A VA (Veteran Administration) loan is a type of loan that is extended by private lenders to veterans, who are eligible for the program. |
The main differences between a VA home loan and a regular mortgage exist in the rates offered, in the need for a down payment as well as in the percentage of costs sanctioned.If you are looking to buy a brand new home, manufactured home or even a condominium, you can obtain financing for a large percent of your expenses using a VA loan. The loan limit for a VA loan is $417,000 which is an amount much larger than anything available with a regular mortgage.
The interest rates for a VA loan are much lower than prime rates of the period. The current rate for a 30-year fixed VA loan is 5.1 percent. This is lower than the prime mortgage rate due to something known as a VA guarantee. This guarantee is nothing but using the property as collateral for the loan amount. Here the property is pledged to lender as security against the loan. Thus, private lenders are assured that the loan extended to the veteran is backed by the government for at least the amount stated in the guarantee.
The government also provides the veteran with VA-insurance that guarantees the repayment of the loan. Hence, the lender does not demand any down-payment upon the sanctioning of a VA loan as he can be assured his money will be returned to him, no matter what.
If you have been in military service during a war, a VA home loan is an amazing way to finance a comfortable home for you and your family.
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