VA Mortgage Loans: Do You Qualify?

The Veterans Administration mortgage loan program was created in 1944 as part of what became known as the GI Bill of Rights. The goal of the program was to help returning war veterans become home owners. 

The key to the success of the program was that no down payment was required. This allowed veterans returning from the war to purchase homes almost immediately, without having to save for a down payment. While some of the specifics of the program have changed over the years, VA loans are still insured by the government against default, and still offer no down payment or private mortgage insurance. Read more on Choosing a Mortgage Loan.

Here are some other benefits of VA loans:

• No prepayment penalties;
• Insured against default by the United States government;
• Lower closing costs.

Another benefit of a VA loan is the ability to apply for an interest-rate reduction loan. Offered by the VA as part of the Streamline Refinancing Program, this loan allows veterans to refinance to a lower rate with little or no out-of-pocket expenses. Read Should I Refinance My Mortgage Loan? for more details on refinancing.