September 2nd, 2016 11:44 AM by Joan Rusco
We’ve extolled the benefits of a VA backed mortgage loan on these pages before but there is one that is exceptional and, in our opinion here at VALoansMN, deserves special attention.
First, remember that our loans are reserved for only a few. Yes, there are many military veterans and active duty men and women and all can apply for consideration. But, when one considers that only 1 in 4 American men and 1 in 50 women are U.S. military veterans you can see that you are part of an elite population. That is why the VALoansMN mortgage program is reserved for only you.
Only you as a veteran or active duty military can be considered for a mortgage which does NOT NEED A DOWNPAYMENT to purchase a home. Only you as a veteran or active duty military can have 100% financing and NOT PAY A MONTHLY MORTGAGE INSURANCE PREMIUM.
Only you can be protected by the stringent rules regulating the low fees and costs of a VA mortgage.
You can see that you are part of an elite group who has earned the right to have your home loan GUARANTEED BY THE U.S. VETERANS ADMINISTRATION. But there is one other benefit of qualifying for a VALoansMN mortgage that we think needs the special attention we referred to earlier.
Anyone who has previously had a mortgage knows that in the first several years most of your monthly mortgage payment goes to interest. If you have a $200,000 mortgage with a monthly payment of about $950 (estimation of current mortgage rates assumed) in seven years you would pay down that $200k loan by only about $28,000 dollars. Over $52,000 of those payments would be for interest. So you would have a balance remaining of over $170,000! So why is this a good thing for you? Because, while you may still owe a lot on your house, this mortgage may increase the value of your home. Huh? Read on for details.
A VA mortgage has a special feature reserved for you elite members of our society. IT IS ASSUMABLE by another qualified veteran or active duty military person. That means that if you decide in the future to sell your home a veteran could assume the mortgage you have now. So let’s say you buy your home given the numbers we’ve used so far. You pay $200,000 with NO MONEY DOWN, your mortgage rate is 4% (we’re actually doing loans with lower rates!) and you decide, for whatever reason, that you need to sell your home in 7 years. Let us ask you this question; do you think mortgage rates will be lower or higher in 7 years? Might we return to the days of 7, 8 or even 10% mortgage rates? We see that as a real possibility. But, here you sit with an assumable VA loan at 4% (or less!). And, for arguments sake, let’s say there’s another house similar to yours down the block for sale at the same price. The buyer of that house would have to get a mortgage at those higher rates (7,8 or even 10%) while you could offer your qualified veteran or active duty military person a mortgage at today’s extremely low rates. Who’s house do you think is going to sell faster?
Granted the buyer could only take over your mortgage that has a balance of about $170,000 but that might be a huge chunk of the purchase price. They could either come up with cash or take out a 2nd mortgage for the rest of the cost. Still, it would be a real saver for the future buyer of your home.
Want to know more about how you can take advantage of this program for the elite few? Give us a call at VALoansMN and let us walk you through the benefits of having a VA Loan. You’ll see why our clients consider us the upper midwest's NUMBER ONE VA LOAN SOURCE.