Eligible veterans may contact the U.S. Department of Veterans Affairs (VA) for assistance with a home purchase loan from a local lender.

VA guaranty loans encourage lenders to assist veterans by providing protection against loss if the borrower fails to make payments.

VA loans are particularly beneficial to those veterans without cash available.

1. Equal Opportunity for All Eligible Veterans

All veterans are given an equal opportunity to buy homes without regard to race, religion or other personal characteristics. There’s really only one requirement; you must move in within a reasonable period of time after closing the loan.

2. No Down Payment

As long as the purchase price correlates with the inherent value of a home, the VA does not require veterans to make any advance payments. If the VA determines the price is excessive, veterans may be required to front the difference.

3. Buyer Informed of Reasonable Value

The VA will independently order an appraisal to assess the reasonable value of a property, and the buyer will receive a copy prior to closing the loan. However, the VA’s appraisal should be treated separate from a thorough property inspection, and veterans should seek expert advice in this area before making any legal commitment.

4. Negotiable Interest Rate

VA loans provide a freely negotiable fixed interest rate competitive, and sometimes even lower, than conventional mortgage interest rates.

5. Financing of Funding Fee

The veteran can fold the VA funding fee into the overall mortgage. The funding fee may be reduced if the veteran makes a down payment of five percent or more, and total exemptions are offered for veterans receiving disability compensation.

6. Comparable Closing Costs

The closing costs correspond or save money compared to other financing types because the VA limits certain fees. Sometimes, the VA asks the seller to incur or negotiate regarding this expense.

7. No Mortgage Insurance Premiums

Unlike other loan types with minimal down payment requirements, a VA loan is guaranteed by the government and avoids the need for any mortgage insurance.

8. An Assumable Mortgage

A VA loan represents an assumable mortgage. It reviews the credit and character of purchasers to ensure they will make monthly mortgage payments on time. Note: Borrowers must notify the VA or their lenders to be granted a release from liability from the original loan.

9. Prepay Without Penalty

The VA lets veterans pay off their VA loan early or designate extra payments on the principal without any penalty.

10.VA Assistance to Avoid Default

The VA offers financial assistance and "forbearance extensions" to veteran borrowers who experience economic hardships.

Veterans with specific service connected disabilities may also be entitled to a grant from the Department of Veterans Affairs (VA) for the purpose of constructing an adapted dwelling or modifying an existing one to meet the veteran’s needs. The Specially Adapted Housing (SAH) Program attempts to create a barrier-free environment to provide veterans a higher level of independent living. For more information on these and other VA Affairs services, visit www.va.gov.