Did you know that the VA loan is a great tool? It can be used for multiple loans at the same time as long as you don’t exceed the guarantee. There are many other uses for the VA Loan, make sure you are using it right with these tips!
Pros and Cons of the VA Loan
- No downpayment required.
- The funding fee is rolled into the loan.
- It currently has lower interest rates.
- Funding Fee (Rates vary based on if it is your first loan or subsequent and how much is down).
Great Uses for the VA Loan
The VA Loan is great for people that want a loan with no money down. It is great for people who want to hold the house for a long period of time as the cost of the funding fee reduces over time. But the biggest problem with the VA Loan is the funding fee. It is 2.15% for the first time and 3.3% for any purchases afterward.
- $100K- $2,150 or $3,300
- $200K- $4,300 or $6,600
- $300K- $6,450 or $9,900
Poor Uses for the VA Loan
This is a bad loan if you plan on selling your house in a short period of time. There are many other loans that don’t have funding fee, but they do have a downpayment, so you will have to weigh the pros and cons on what you want to do.
Splitting the VA Loan
The VA Loan now allows you to split the loan up to as many times as you want as long as you do not exceed the allowance amount of $417k (some areas are more). This is a great resource for people who want to have multiple cheaper loans rather than one great big loan.
Splitting the VA Loan is an awesome tool as it allows homeowners who do not use the entire amount to buy another house with no money down. In fact, my husband and I have used it for two houses, one in Hanford and one in Virginia Beach. It was great because it allowed us to buy two houses with no downpayment. The only downside is the fact that the funding fee is more expensive after your first loan.
Do you use the VA Loan? What are some ways you are using it right now?0