With a VA mortgage loan you can get more house with less money up front.

The VA allows you to use a VA mortgage loan for up to $417,000 (and even higher in some high cost areas) with zero down payment and no mortgage insurance. While it is true that some $0 down-payment conventional loan programs exist, the interest rates on these programs are not as competitive as a VA mortgage loan and the programs are driven by credit score. This means that unless you have absolutely perfect credit they are not available to you. With a VA mortgage loan, the rates are more competitive and the credit requirements are much more reasonable. Eligibility for a VA mortgage loan is not driven by your credit score, but instead by your faithful service to our country.

VA mortgage loans do not require you to carry expensive mortgage insurance.

For the same reason you no longer want to throw money away paying rent, paying mortgage insurance is smart to avoid. Unlike a Conventional loan where mortgage insurance is required on any loan without 20% down, on a VA mortgage loan there is not a requirement for this costly fee. The avoidance of mortgage insurance with a VA mortgage loan can save hundreds of dollars a month over a conventional loan at the same rate.

Because conventional loans are so dependent on credit scores, you are likely to save more money each month and get a lower rate with a VA mortgage loan.

All things being equal, a borrower who qualifies for a VA mortgage loan, but has less than perfect credit, is more likely to get a better rate with a VA mortgage loan than with a conventional loan. The 25% guarantee offered by the VA sets aside many of the worries the lenders have in lending without a down payment. Because this guarantee is in place veterans win.

A VA mortgage loan offers another aspect not seen by conventional loans.

Assumability. A VA mortgage loan can be assumed by another eligible party. Meaning that if you have a particularly low rate (say 4.5% fixed for 30 years) and you wish to sell the home, another veteran can purchase your home and assume the payments of the loan at that low rate. This works great in communities where many servicemen and women sell their homes with relative frequency because of duty requirements. This also is important for veterans who wish to pass their home on to their heirs. For many multi-generational military families this added benefit enables a family home to be passed on form generation to generation.

You will never pay a pre-payment penalty with a VA mortgage loan.

This is important for a few reasons. First because that VA has mandated this, a veteran will never have to pay to get out of a mortgage because of a penalty. If duty calls you to another area of the country you can sell your home with the peace of mind that you will not be paying the bank for the right to pay off your loan. Secondly without a prepayment penalty in place you may refinance you home at anytime you see fit. With the recent down turn in the economy many veterans have refinanced their VA mortgage loan in order to take advantage of historically low rates.  Because there is not a prepayment penalty with a VA mortgage loan veterans have greater flexibility. Not when the lender dictates but when the veteran chooses.

Debt ratios can wreak havoc with prospective borrowers of conventional loans.

With a VA mortgage loan a borrower is able to qualify for a loan with a higher ratio. This is great for the borrower on two fronts. With a VA mortgage loan you can qualify for more home with a lower income, or you can qualify for a home when the total of your other debts would prohibit you from getting a conventional loan. With a VA mortgage loan your debt ratio can exceed 36% making it easier to qualify for than with a conventional mortgage.

Closing costs can be covered with a VA mortgage loan.

With a VA mortgage loan the seller is allowed to contribute up to 6% of the loan amount to cover your closing costs. With a conventional loan only a 3% closing cost allowance is permitted. Combined with the 100% financing options offered by a VA mortgage loan, a veteran can purchase a home and have all the fees paid for and included. Imagine purchasing a home with literally not one penny out of pocket. With a VA mortgage loan this is not a dream it is reality.

A VA mortgage loan comes in many varieties.

If a fixed rate is what you want great. If a variable rate suits your needs better a VA mortgage loan can help there as well. With the flexibility of choosing between a traditional fixed rate or a Hybrid ARM, veterans have the ability to determine which loan program fits them best. Whether you are buying your dream home and want a 30 or 15 year fixed VA mortgage loan, or plan to move transfer duty stations in 3 years and choose a 3/1 or 5/1 Hybrid ARM, with a VA mortgage loan you have options.

Interest rates on a VA mortgage loan track very closely with their conventional counterparts.

In some cases rates on a VA mortgage loan may even be lower. Currently interest rates have been at historical lows. There has never been a better time to get a VA mortgage loan since their inception in 1944.