Everyone wants a place to call home, especially those in most need of a home: our nation's deserving veterans.
In a recent survey from CENTURY 21, homeownership was cited as the most important thing to returning service members. More than 88 percent said that it made them feel safer, as well as established a sense of financial security and community.
"Home ownership is a top priority for many, but it is especially significant to those returning from a tour of duty," said Rick Davidson, president and CEO of Century 21. "Veterans have done so much to serve our country."
Yet only 33 percent actually look for a home within a year of returning from duty. If you're ready to start the journey toward your home loan, today is the day to start.
Still, what's stopping so many from achieving their dream of buying a home?
According to the report, service members and their families have three main factors that hinder their chances at home ownership: down payment, price and personal savings.
A borrower who is able to put up a sturdy down payment typically seems to be a safer risk in the eyes of the lender, but it also proves to be beneficial for the borrower. The bigger the down payment, the less the buyer will owe over time and eventually have to repay in interest.
The price of a home can be intimidating by itself. With additional expenses such as insurance, taxes, utilities and maintenance, the cost can be near overwhelming.
These expenses can be draining on a bank account, especially if the buyer is drawing from personal savings to pay for them. Without a healthy savings, the buyer risks not having enough money for sudden emergencies or expensive repairs.
Luckily, the VA loan program was put in place to simplify the process for those who have fought for our country, in turn giving them a fighting chance at home ownership. That means service members and their families shouldn't worry about obstacles like a down payment, price and personal savings.
The real obstacle? Unawareness. Many military families aren't even aware of the exceptional benefits of the VA loan.
"Despite their wide-ranging benefits, VA loans have been utilized by only a fraction of the nation's 24 million veterans," said Chris Birk, the author of The Book on VA Loans. "Nearly 20 percent of veterans are not even aware of the program's existence."
In other words, they're missing out on an opportunity that could save them a significant amount of money and worry.
Perhaps the biggest benefit of a VA loan is that there's no down payment required. With other loan types, a down payment is typically required to act as a safety net in case the borrower defaults on the loan. With the VA loan, a portion of every loan is backed by the federal government. Since this "VA Loan Guaranty" acts as a federal safety net, it takes the place of a down payment.
And this benefit can save the borrower big bucks.
According to the CENTURY 21 survey, one of the major things that keeps veterans out of homes is the inability to afford a down payment. With the VA home loan program, they've got you covered.
"Many VA borrowers don't spend a single dime up front on down payments on VA home loans," said Birk.
Not having to scrape together enough for a down payment makes a new house purchase more attainable, but the VA loan makes the price more affordable, as well.
For instance, veterans who qualify for a VA loan can also save big on private mortgage insurance. The VA loan doesn't require borrowers get private mortgage insurance, unlike other loan types which often require it for borrowers who are unable to put at least 20 percent down on a home.
"On an average loan of about $200,000, our research has told us that you can save around $200 a month," said John Bell, Assistant Director of the VA Home Loan program.
That means that service members and their families don't have to worry about emptying their personal savings accounts just to afford a home.
The VA loan program gives them an exemplary opportunity to achieve their dream of home ownership – of safety, financial security, community. For everything that these men and women have sacrificed serving our country, this benefit is one small step toward showing the thanks they so deserve.
If you or someone you know is a veteran or service member also looking to achieve this dream, give a VA Mortgage Specialist a call at 855-870-8845. If you're ready to break the mold and get started on your path to home ownership, today is the day to start.
Midway through Fiscal Year 2021, the VA loan program is on pace to blow past last year's record-setting 1.2 million loans. See which cities are seeing the most growth compared to last year.