Pros & Cons of a VA Loan
The VA helps service members, veterans and their survivors become homeowners by providing an exclusive loan benefit. Since the VA guarantees part of the loan, lenders can offer very favorable terms.
Pros of a VA Loan
Credit score requirements are less stringent and income requirements tend to be looser.
No down payment required!
Interest rates on VA loans are lower than on other loan types.
With most loans, you’d be obligated to pay private mortgage insurance if your down payment were less than 20%. With a VA loan, there is no PMI.
The VA loan benefit never expires. You can use it multiple times. The funding fee does increase with each use, but that fee can be rolled into your loan.
Cons of a VA Loan
Unless you’re buying a multi-family unit, a VA loan can’t be used for investment property.
VA buyers cannot waive the appraisal contingency. Ten days is the typical timeline to complete a VA appraisal, but in times of high volume, it can take much longer. If repairs are needed, the appraiser will have to reinspect before signing off.
Sellers in competitive markets may not be open to VA offers due to lack of awareness and understanding of modernized VA guidelines.
