VA loans are mortgages that are guaranteed by the United States Department of Veteran's Affairs. VA
loans allow an eligible service member to get 100 percent financing on a home without having to pay for private mortgage insurance. On most other types of mortgage financing, if a purchaser borrows more than 80 percent of the value of a home, the lender requires him or her to purchase mortgage insurance.
An eligible veteran can obtain 100 percent financing on a mortgage of up to $729,750, although the total may be lower in some states and counties. To determine the local loan limit, visit www.vamortgagecenter.com/va-loan-limits.html.
If a veteran is seeking to borrow an amount greater than the local limit, the veteran can bring in a down payment of up to 25 percent of difference between their maximum loan amount and the purchase price and still have the loan guaranteed by the VA.
Another benefit of a VA loan is that the seller is permitted to pay all of the buyer's closing costs. A veteran with using a VA mortgage can actually get into a home with zero dollars coming out of his pocket.
Eligibility requirements for V.A. loans are described in detail on the agency's Web site: www.homeloans.va.gov/elig2.htm.
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