Home Loan Options for Veterans
In honor of Veterans Day and all of the past and present military members who deserve our gratitude year-round, Open Mortgage thanks you for your service and sacrifice.
The home loan choices available to veterans and active service members can be overwhelming. We are proud to help you navigate your mortgage options to find the one that best fits your needs. Members of the military, National Guard, eligible surviving spouses, veterans and reservists could qualify for loans that the U.S. Department of Veterans Affairs partially guarantees. This allows lenders like Open Mortgage to offer special benefits and optimal terms to eligible borrowers. Start your search for a home with this list of VA lending programs and other opportunities that might be right for you.
VA loans can help veterans who have struggled to build savings or establish credit due to their military deployments. There’s no down payment required in most purchases and no requirement for additional private mortgage insurance (PMI) since the federal government guarantees repayment. Often, interest rates on VA loans are also lower than other lending alternatives.
All of these features combine to offer significant savings to many military borrowers. Eligibility starts by obtaining a Certificate of Eligibility from the U.S. Department of Veterans Affairs. The loans are also limited to purchasing a primary home. However, VA programs are available to refinance an existing loan or cash-out equity and improve your current home.
While VA loans can be an excellent way to minimize homebuying costs, veterans over 62 have an additional option to consider. A Home Equity Conversion Mortgage (HECM) or reverse mortgage can provide access to equity and defer any repayment as long as the home remains the borrower’s primary residence.
A HECM for purchase or HECM Line of Credit expands the program’s flexibility to those wanting to downsize, relocate or have access to emergency funds. Older veterans hoping to cut their expenses or supplement their retirement income may find the benefits of a HECM exceed those of a VA loan for their specific circumstances.
While the lack of a down payment requirement and avoidance of PMI is hard to beat, borrowers who plan to make a substantial down payment should still consider all their options. Conventional funding with a large enough down payment could be competitive when it comes to interest rates or other terms.
Shopping for a home loan requires working with a lender who understands the complexity of your options. Start your conversation with a specialist from Open Mortgage today to learn more, or browse our website for more lending resources to get you headed in the right direction.
- At the conclusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds
- Charges will be assessed with the loan, including an origination fee, closing costs, mortgage insurance premiums and servicing fees
- The loan balance grows over time and interest is charged on the outstanding balance
- The borrower remains responsible for property taxes, hazard insurance, and home maintenance, and failure to pay these amounts may result in the loss of the home
- Interest on a reverse mortgage is not tax-deductible until the borrower makes partial or full re-payment