VA LOANS

0% Down.  Competitive Rates.  No Monthly PMI. 

EXCEPTIONAL BENEFITS FOR THOSE WHO HAVE SERVED OUR COUNTRY

Active Duty, Veterans, Reservists, and National Guard

VA LOAN BENEFITS

  • 100% financing - down payment as low as 0%

  • Waive escrows - monthly payments without property taxes and homeowners insurance (requires 640+ credit score)

  • Low interest rates

  • No monthly private mortgage insurance (PMI) required

  • Gift funds can be used

  • VA funding fee can be financed or zero funding fee for disabled veterans

VA LOAN BASICS

WHAT IS A VA LOAN?

  • A VA loan is designed to provide housing assistance for veterans and their families to help the dream of home ownership become a reality for millions of veterans

  • VA loans are made by private lenders and guaranteed by the VA if the loan is not repaid

  • The VA guarantees a maximum of 25% of a home loan amount up to $127,600, which limits the maximum loan to $510,400 for 2020.

  • Generally the reasonable value of the property or the purchase price, plus the funding fee may be borrowed (wrapped into the loan)

WHAT CAN A VA LOAN BE USED FOR?

  • A VA loan can only be used for a home that you will live in as your primary residence for at least the first year. This can include single family, condo in a VA-approved project, a home purchase/renovation project, manufactured home, or building a new home 

  • The maximum loan amount in most areas is $510,400. High cost counties may have a higher limit.

  • A VA loan may also be used to refinance an existing VA-guaranteed or direct loan for the purpose of a lower interest rate or to refinance an existing mortgage loan if the property is occupied by the veteran as a home

HOW DO I QUALIFY FOR A VA LOAN?

  • You must have a credit score of at least 500, sufficient income, and a valid certificate of eligibility (COE)

    • To be eligible for a VA loan you must have served on active duty and have a discharge other than dishonorable after a minimum of 90 days of service during wartime or a minimum of 181 continuous days during peacetime. There is a 2 year requirement if the veteran enlisted and began service after Sept 7, 1980 or was an officer and began after October 16, 1981. There is a six year requirement for national guards and reservists with certain criteria and there are specific rules concerning the eligibility of surviving spouses

    • Being a veteran doesn’t make a home buyer automatically eligible for the loan, you must also meet the credit and income requirements. VA guidelines do not automatically disqualify borrowers who have had a foreclosure but it is a case by case scenario. The VA advises lenders to consider overall payment patterns rather than isolated occurrences of unsatisfactory repayment.

WHY DO I WANT A VA LOAN?

  • If you are eligible for a VA loan, there are quite a few benefits of taking advantage of this loan type

    • Ability to borrow up to the conventional loan conforming limit with no down payment (as long as the sale price isn’t higher than the appraised value. You would need to put the money down for the difference)

    • Better loan terms and interest rates

    • No private mortgage insurance or mortgage insurance premiums

    • Fewer closing costs (buyers do not typically pay commissions, lower limits in brokerage fees, or termite inspection costs)

    • No prepayment penalty fee

    • Thorough appraisal to ensure a safe property (the property being purchased needs to be in relatively good condition - no chipping paint, wood rot, wall cracks, roof issues, poorly fitting windows, etc.)

ARE THERE ANY DOWNSIDES TO CONSIDER?

  • With all the benefits offered by a VA loan, there is one upfront cost to be aware of - the VA funding fee.  This fee helps to keep the VA loan program available to all veterans.  It can be paid at closing or financed.

    •  The first time the loan is used, the funding fee is 1.4 to 2.3% of the purchase price (depending on the down payment).  For subsequent purchases, the fee varies from 1.4% to 3.6% depending on the down payment on the loan. 

    • The first time a cash out refinance is utilized the VA funding is 2.3%.  For subsequent refinances it will go up to 3.6%.   

    • Streamline refinances (no cash out and secure a lower rate or shorter term) have a much lower fee of 0.5%, independent of the number of times its used.

2020 VA FUNDING FEES

The experts at Simplicity Mortgage are available to help you compare a VA loan to other loans, such as conventional and FHA, to see which loan will be the most financially beneficial for your specific situation

TO CONTACT OUR TEAM,

CALL, TEXT, OR EMAIL:

SIMPLICITY MORTGAGE

386.401.9000

INFO@SIMMORTGAGE.COM

COMPANY NMLS # 1755062

411 DUNLAWTON AVENUE

PORT ORANGE, FL 32127

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