What Is A Veteran Affairs Loan
The United States of America is one of the best militaries in the world and has some of the best, most well-trained soldiers. When a soldier in the United States serves his or her country, they are automatically given certain benefits such as a VA loan. VA loans are mortgages that are guaranteed by the United States Department of Veteran Affairs. The program is guaranteed to American veterans, active duty soldiers, reservists, and some surviving spouses of soldiers who have perished on the battlefield. The VA loans allows for the veteran to be allowed to purchase a single-family home or condominium, new or used.
Positive Aspects of a Veteran Affairs Loan
There are many benefits associated with obtaining a VA loan. The first is that there is no money down needed on most occasions. This kind of loan is possibly the only true no-money-down loan that’s available in the market. This loan requires no mortgage insurance and closing costs are extremely low. This can be very beneficial to the homeowner because it saves him or her money. Also, it is easier for the veteran or soldier to qualify for the veteran affairs loan. These loans are guaranteed by the government so no one who fits the qualifications is denied. The veteran or active-duty soldier has the ability to shop and compare loans because the loan themselves are actually given by banking institutions, credit unions, and mortgage lenders. The veteran affairs loan can be used in many different ways such as for refinancing an existing mortgage. The loan rates can also be fixed or adjustable as well.
Home Buying with A Personal Loan
Most people who use personal loans to buy a home usually buy a tiny home, smaller home, or manufactured home. The reason why people use personal loans to purchase a home is because they do not have a conventional mortgage. Personal loans are unsecured. Therefore, if you were to purchase a home and default, the bank will not repossess or foreclose on your home as they would with a conventional mortgage or a veteran affairs loan. The term of a personal loan is also shorter than a veteran affairs loan, usually between 1 to 7 years.
There are benefits to getting a personal loan. The first being that you will not be charged income tax on what you borrowed unless the lender chooses to forgive the debt. Another great aspect of a personal loan is that most lenders do not require a down payment of any kind, as would be required for a conventional mortgage loan. The third and most beneficial aspect of getting a personal loan is that if an individual is facing financial hardships, they may be able to go to the lender to renegotiate a lower repayment plan. So, if you’re not looking to purchase a $200,000 house (for example), as a veteran you should consider a veteran’s loan. If you are interested in purchasing something more like a $32,000-$80,000 manufactured home, a personal loan would most likely be the smarter way to go.