Wednesday, 8 August 2012

VA Guaranteed Home Loans

They are loans made by private lenders (banks, savings and loans, and mortgage companies). There loans are made to eligible veterans for the purchase of a home loans for themselves and their families. The house you buy should be a 1-4 family home that you occupy. Buying real estate investment are not allowed. Again, the house must be for your own personal use.

VA does not make loans. The Veterans Administration does not guarantee the loan. They guarantee that the lender makes the loan will not lose money if payments are not made. This encourages lenders to make loans to veterans with more favorable conditions, such as 100% financing, low rates, low fees, and reduced closing costs. The guarantee is not automatic. You must still qualify for the loan based on the guidelines set loan guarantee by the VA. This ensures that they are safeguarding qualified borrowers and reduces their risk of loss.

What can this loan will be used for?

A VA loan can be used to buy a house, condominium, townhouse, or co-op. It can also be used to build a house, repair or improvement of an existing home, to add energy efficiency improvements (solar heating / cooling systems, water heaters, insulation, doors and windows against , etc.), or to refinance a home to reduce the interest rate.