Erected by the Servicemen’s Readjustment Act in 1944, VA loans in Los Angeles are providing active-duty service members and retired military staff with the housing they deserve. The perks of a VA loan are evident—from a zero-down payment scheme to the purchase of a mobile home, this guide will examine the sterling properties of this government-funded mortgage.
The Perks of a VA Loan
For added security, the Department of Veterans Affairs collaborates with private lenders in accepting liabilities in the event of a default. With this guarantee in the pocket, VA loan applicants can enjoy additional benefits such as a waived PMI requirement, a waived prepayment penalty, and limited closing costs.
The VA loan’s most sterling characteristic is its ability to fund housing in full. Though it sets limits to the amount it can guarantee, it doesn’t limit the percentage of a property’s value.
VA Loan Fees
Like any other loan, a VA loan will charge fees. How much of your loan value you’ll pay as a VA Funding Fee will depend on the following factors.
- The type of service category you fall under (members of the Reserves and National Guard pay higher fees than that of regular service members)
- Whether you are applying for a VA loan for the first time
- Whether you’re making a down payment (and taking into consideration the amount)
Calculating VA Loan Guarantees
Veterans applying for a VA loan have a maximum entitlement of $36,000, given that they don’t already have one active. Generally, a VA loan guarantee will equal four times a veteran’s entitlement, with a maximum amount of $144,000.
A VA loan limit refers to the amount guaranteed—not how much you can borrow. Say you have full entitlement and want to purchase a home worth $350,000. Securing a quarter of its loans back, the VA can offer you 25% of the loan limit within your county (in this case, $106,025) or 25% of the home value ($87,500).
Alternatives to a VA Loan
You can use a VA loan for purposes beyond homebuying. If necessary, you can use a VA loan to pull cash from your home equity. You can use this to refinance an existing loan or shoulder anything from home renovation fees to a college education. Whatever you choose, the VA will guarantee the loan up to 100% of your home’s value.
Veterans can also leverage the Interest Rate Reduction Refinance Loan (IRRRL) against current market rates. If the market rate is lower than your current interest rate, an IRRRL application can work to your advantage.
Shannon Christenot for VA Loans in Los Angeles
If you’re a member of the military community and looking to provide your family will a fully financed home, a VA loan may be right for you. However, you can take advantage of other VA funding to accommodate service-related disabilities or educational purposes. You can apply the same VA loan guidelines to meet different financial needs.
With Shannon Christenot, we can pair you up with the right mortgage lenders to score the best VA loan in Los Angeles. A bustling city with a diverse population, the opportunities for housing in California are border-less. With over two decades of experience, we can guarantee the best loan terms possible. Contact us today at (818) 601-2231.