Sunday, February 18, 2018

5 Things You Didn't Know a VA Loan Could Do for You (3 of 5)

3. No mortgage insurance

Most conventional buyers have to pay private mortgage insurance if they put less than 20% down. FHA loans come with their own forms of mortgage insurance. But a VA loan waives that insurance requirement.
And trust us—this one's important.
"This can be a big savings in monthly payments, since PMI typically runs around $200 a month," says Realtor® Twila Lukavich with Russell Real Estate Services in Cleveland.
Even though there's no mortgage insurance, there is a "funding fee"—an upfront cost applied to every purchase loan or refinance. The proceeds help the VA cover losses on the few loans that go into default. But borrowers can roll it into their monthly payment, or pay it all at once. Plus, it's tax-deductible. And veterans with a service-connected disability don’t have to pay the funding fee at all.

No comments:

Post a Comment