VA Mortgage Rates Lower Than Conventional Mortgage Rates By 0.375 Percentage Points

• MORTGAGE RATES

Mortgage interest rates are dropping.

Since the start of the year, 30-year and 15-year mortgage rates have moved lower steadily, bestowing cheap financing opportunities upon active home buyers and existing homeowners in search of a refinance.

However, mortgage rates don't fall equally.

Applicants in search of the today's mortgage rates will find VA mortgage rates and FHA mortgage rates markedly lower than the rates available for a comparable loan via Fannie Mae or Freddie Mac.

According to Ellie Mae, current VA mortgage rates are the lowest mortgage rates today -- by far

Click to compare mortgage rates. 

VA MORTGAGE RATES 0.375% BELOW CONVENTIONAL RATE

For mortgage applicants in search of the today's lowest mortgage rates, mortgage software provider Ellie Mae reports that VA mortgage rates are the lowest.

The data comes from the company's Origination Insight Report, a report is culled from some of the 3.5 million mortgage loan application which pass through Ellie Mae's servers annually.

According to the September report, the average mortgage rate on a closed VA loan is a little more than 37.5 basis points (0.375%) lower than the average mortgage rate for all closed conventional loans. VA mortgage rates averaged 4.12% in August.

The next-lowest mortgage rate was the average rate for an FHA loan.

In September, FHA mortgage rates averaged 4.27% nationwide. This, too, is below the average rate for a conventional loan.

FHA mortgage rates beat conventional mortgage interest rates by about a quarter-percent. However, because FHA-insured homeowners are required to pay annual mortgage insurance premiums (MIP), the true cost of using an FHA loan is much higher than that.

Of all tracked loan types, mortgage rates for conventional loans was the highest.  Conventional mortgage rates averaged 4.51% in September, according to Ellie Mae -- one-eighth percentage point above the average rate of all loans closed.

Note, though, that Ellie Mae's reported rates print higher than the average weekly and monthly mortgage rates as reported by government-backed Freddie Mac. There are two valid reasons for this.

The first reason is that Freddie Mac's rates are discounted to account for discount points. Paying discount points give borrowers access to lower rates overall.

The second reason why Ellie Mae mortgage rates are higher is because Freddie Mac's rates are meant for prime mortgage borrowers only. Ellie Mae's published rates account for all borrowers of all types.

Many mortgage banks now quote rates in the 3s.

Click to compare today's mortgage rates.

BENEFITS OF THE VA LOAN GUARANTY PROGRAM  

VA mortgage rates are available to eligible military borrowers as part of the VA Loan Guaranty Program.

The VA Loan Guaranty Program is 70 years old. It's backed by the Department of Veterans Affairs and can be used for a purchase or a refinance. The Department of Veterans Affairs guarantees VA loans against loss, which helps mortgage lenders to make available lower mortgage rates to applicants.

Aside from low mortgage rates, there are other VA loan benefits, too.

As one example, VA loans allow for 100% financing. There is no downpayment requirement with a VA loan, and mortgage insurance is never required. 

Another VA loan benefit is that VA loans are assumable. This means that a home can be sold with VA financing "attached" to it.

This can be a selling point given today's low mortgage rates. If you lock a VA mortgage rate near 4%, regardless of future mortgage rates, the eventual buyer of your home can get your same four percent mortgage interest rate.

There are other VA loan benefits, too, including loose underwriting standards and access to the VA Streamline Refinance, one of the fastest and simplest mortgage refinance programs available in today's market.

Click to get today's rate quotes. 

ALL MORTGAGE RATES DROPPING

It's not just VA mortgage rates which are low. Rates are low for all loan types.

Since the start of the year, mortgage rates have been on steady decline and, according to Freddie Mac's weekly Primary Mortgage Market Survey, rates are down more than 62.5 basis points (0.625%) from January.

Low mortgage rates have boosted home affordability and put millions of existing U.S. homeowners "in the money" to refinance.

This wasn't supposed to happen.

At the end of last year, the Federal Reserve announced that it would wind down its third round of quantitative easing (QE3) though 2014.

Wall Street expected this move to lead mortgage rates higher. After all, the Fed had been buying $40 billion in mortgage-backed securities (MBS) monthly and, without the Fed to purchase excess MBS monthly, rates would rise to meet supply.

Yet, rates have been dropping.

A series of worse-than-expected economic data have combined with new geopolitical risk to stoke safe haven buying, a trading pattern in which investors seek safety of principal during a period of uncertainty.

Furthermore, there has been less mortgage bond issuance this year because mortgage origination volume is down.

Despite the Fed's exit, demand for U.S. mortgage bonds continues to outpace supply, which is leading 30-year mortgage interest rates lower.

Going forward, mortgage markets will remain data-dependent. Rates may rise or rates may fall. Today, though, mortgage rates at 17-month lows. The average 30-year conventional fixed rate mortgage is firmly beneath 4 percent, and VA and FHA mortgage rates are approaching the low-3s.

GET TODAY'S MORTGAGE RATES

VA mortgage rates are low, and so are mortgage rates for all other loan types. It's an excellent time to shop for a loan and compare your mortgage options -- either for a purchase or a refinance.

Get a live rate quote now. Mortgage rates are available online with no social security number required to get started, and with no obligation proceed.

Click to get today's rates now.

Contact The Mortgage Mark with any questions!

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It’s Very Unlikely That You’ll Pay FHA Mortgage Insurance For The Rest Of Your Life

• FHA MORTGAGES

In mid-2013, the FHA changed its mortgage insurance premium (MIP) policies.

Formerly, FHA MIP typically canceled after 5 years assuming a 78% loan-to-value. Today, however, FHA mortgage insurance can last for a loan's full 30 years. The policy can be confusing -- especially because the amount of time you'll pay FHA MIP varies by your loan type.

When you use an FHA mortgage, you'll want to know for how long MIP is required.

Click here for today's mortgage rates.

THE FEDERAL HOUSING ADMINISTRATION (FHA)

For nearly 80 years, the Federal Housing Administration (FHA) has been assisting U.S. home buyers, providing flexible mortgage guidelines and low mortgage rates to help promote homeownership.

FHA loans allows for down payments of as low as 3.5 percent and backs mortgages for borrowers with credit scores as low as 500. It also offers the FHA 203k construction loan, which helps home buyers to finance structural repairs into a home's purchase price.

The FHA is the world's larger insurer of mortgages and its programs are typically used by first-time home buyers and repeat buyers whose credit scores are less-than-perfect.

However, as the FHA's MIP policies have changed, so has the program's economic appeal.

FHA mortgage insurance premiums, which are split into two separate payments, are markedly more expensive as compared to 6 years ago.

Except for first-time home buyers using the FHA HAWK program, today's FHA borrowers pay a 1.75% upfront MIP fee to the agency at the time of closing, along with an annual MIP fee which is spread evenly over 12 annual mortgage payments.

Click to get today's live mortgage rates.

WHEN IS AN FHA LOAN A GOOD IDEA?

There are five government agencies which insure low- and no-downpayment mortgages.

The Department of Veterans Affairs backs a 100% mortgage for members of the military and most veterans; the U.S. Department of Agriculture backs a no-money-down mortgage which is available in most suburban and rural neighborhoods; and, Fannie Mae and Freddie Mac offer a 95% LTV loan for anyone who qualifies.

However, it's the FHA which is the largest insurer of low-downpayment home loans.

In addition to serving first-time buyers, the FHA loan can be a terrific fit for buyer-types such as the move-up buyer who has lost home equity and has little downpayment to carry ahead to a new home; and, for a buyer of a 2-unit, 3-unit or 4-unit home because FHA mortgage rates can be lower by as much as 100 basis points as compared to a comparable conventional loan via Fannie Mae or Freddie Mac for such loan types.

The FHA loan has some unique characteristics as compared to other loan types.

• Minimum credit score requirement of 580
• Downpayment requirement of just 3.5 percent
• Non-occupant co-borrowers are allowed
• Sellers can contribute up to 6 percent toward closing costs
• FHA loans can be "assumed" by a subsequent buyer at the same interest rate

In addition, financing via the Federal Housing Administration gets homeowners access to the FHA Streamline Refinance which is among the simplest, fastest refinance programs available to homeowners today.

The FHA Streamline Refinance guidelines waive verification of income, credit and employment; and require no home appraisal.

Click here for today's live mortgage rates.

PAYING "FHA MORTGAGE INSURANCE FOR LIFE"

Prior to 2013, FHA mortgage insurance canceled automatically for homeowners whose mortgages were FHA-backed. Then, a change in FHA policy decreed that, for certain 30-year loans, mortgage insurance must be paid for as long as the loan is in effect.

Consumers have misconstrued this policy to mean "FHA MIP for life", which is a falsehood.

Paying MIP for life suggests that you'll make mortgage insurance premium payments to the FHA from today until the day you die. The truth is something different.

The FHA's official policy states that loans with an LTV over 90% must maintain MIP for as long as the loan is active. All other loans must pay FHA MIP for a period of 11 years.

The current FHA mortgage insurance premium is shown below :

LOAN TERM	INITIAL LTV (%)	FHA MIP TERM
≤ 15 yrs	≤ 78	11 years
≤ 15 yrs	> 78 – 90.00	11 years
≤ 15 yrs	> 90.00	Life of Loan
> 15 yrs	≤ 78	11 years
> 15 yrs	> 78 – 90.00	11 years
> 15 yrs	> 90.00	Life of Loan

For some FHA loans only, you will pay mortgage insurance premiums until the loan is paid-off in full. This can be as long as 30 years or as few as 1-2 years, such as would be the case if you refinanced your FHA mortgage.

Or, considering that the average household moves once every 7 years, it's possible that you ultimately pay FHA MIP for not very long at all.

GET TODAY'S FHA MORTGAGE RATES

The FHA-backed mortgage remains an important part of today's U.S. housing market. Along with its low downpayment guidelines, mortgage rates for an FHA loan are often low, too.

Compare today's FHA mortgage rates and see for how much home you qualify. Rates are available online with no cost, with no obligation to proceed, and with no social security number required to get started.

Click to get today's live rates.

wContact The Mortgage Mark with any Questions!!   www.themortgagemark.com  mark@themortgagemark.com  

5 reasons to buy a house in the next 5 months

By Hal M. BundrickJuly 21, 2014 3:23 PM

Photo: Thinkstock

A combination of market factors may make you think you're getting priced out of the home market. But one observer believes first-time homebuyers might want to consider making a move.

"I know it's hard to face rising interest rates and rising home prices at the same time," says Ilyce Glink, real estate expert and managing editor of the Equifax finance blog. "The good news is there's still plenty of runway if you want to buy a house this year."

Glink believes first-time homebuyers should consider these five good reasons to buy a house before the end of the year:

Home prices are still off their highs

Yes, home prices are rising from the lows seen during the housing crash of 2008, but they're still nearly 20% off their mid-2006 peak. According to the S&P/Case-Shiller Home Price Index, average U.S. home prices are currently at summer 2004 levels. In markets that are still recovering, first-time homebuyers could see significant appreciation over the next few years, if they buy now.

[Ready to buy a home? Click to compare mortgage interest rates from lenders now.]

Interest rates are expected to keep rising

Interest rates are slowly climbing, and as the Federal Reserve concludes its economic stimulus plan, rates are expected to continue to rise. Some experts believe mortgage interest rates could hit 5% by the end of 2014 or the first quarter of 2015, according to Glink. And even a small bump in interest rates can mean a significant jump in your monthly note.

"If you're offered a 4.2% interest rate on a $400,000 mortgage, for example, your monthly payment will be $1,961, and you'll pay more than $300,000 in interest over the loan's 30-year term," Glink says. "If your interest rate were 4.9%, your monthly payment would jump to $2,115, and the total interest paid over the life of the loan would exceed $360,000."

Rental rates are rising

There is always an argument to be made regarding whether to buy or rent. It's all a matter of your particular situation – as well as the status of your local housing market. If you need to be mobile -- prepared for job transfers or out-of-state promotions -- or are continuing to search for "the perfect place," renting is probably right for you.

However, if you would like to put down some roots, and rents are high in your hometown – it might be cheaper to buy.

"Divide the list price of the home you're interested in by the annual rental rate of a comparable property to determine the price-rent ratio," Glink advises. "If it's below 20, chances are it's a good time to buy."

Of course, buying a home means more than a mortgage. Remember to consider the other built-in expenses: maintenance, insurance, taxes and utilities.

[Shopping for a home loan? Click to compare mortgage interest rates from lenders now.]

Consider your buying power

Americans have been steadily reducing their debt load. Maybe you have, too. The lower your debt, the higher your buying power. Creditors will consider your debt-to-income ratio – how much debt you have, compared to your gross (before-tax) income.

"Experts generally agree that you can spend between 28% and 36% of your gross income in total debt service -- that's your housing expenses plus your other debt payments," says Glink.

With lower debt comes a higher score

As you pay off student loans, credit cards and consumer debt, your credit scorewill improve. And that's one of the biggest factors mortgage lenders consider when determining the interest rate and terms of your loan.

"You should definitely consider buying this year, because it's unlikely the housing market will look much rosier next year, when interest rates and home prices could be even higher," Glink says.

Contact The Mortgage Mark with any Questions!!

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6 Untrue Things People Say About FHA Mortgages; FHA Mortgage Rates

• FHA MORTGAGES

The FHA loan is one of the misunderstood products in the market. For years, the FHA advertised its products as loans for people "on the margins". FHA loans remain among the most flexible and rewarding products available to today's U.S. home buyers.

There are 6 common misconceptions about the FHA mortgage, though, and these falsehoods could be standing between you and a bona fide FHA loan approval. Read more below.

Click to get today's live FHA mortgage rates now.

MYTH 1 : THE FHA IS A MORTGAGE LENDER

Fact : The FHA is not a mortgage lender. It's a mortgage insurer.

The acronym "FHA" stands for Federal Housing Administration, a government agency within the U.S. Department of Housing and Urban Development. The FHA doesn't make mortgage loans to home buyers or refinancing households. Rather, the FHA provide mortgage insurance to banks, credit unions, and other lenders which make loans meeting FHA insurance standards.

The FHA reimburses lenders for a portion of incurred losses in the event that their FHA-insured loans default, or go to short sale or foreclosure.

MYTH 2 : FHA LOANS ARE FOR FIRST-TIME BUYERS ONLY

Fact : FHA loans are not for first-time buyers only. FHA loans can be used by first-time buyers and repeat buyers alike.

The FHA loan is often marketed as a product for "first-time buyers" because of its low downpayment requirements. However, last decade, many U.S. homeowners have lost home equity in the housing market downturn. These repeat buyers may have little money for downpayment -- even after the sale of their former home.

The FHA will insure mortgages for any primary residence. You don't need to be a first-time buyer.

However, if you are a first-time buyer, the FHA may reduce your mortgage insurance premiums for you. Agree to attend homeownership education classes and make your payments on-time and, via the FHA HAWK, program the agency will reduce your upfront and annual MIP.

Click for today's live FHA mortgage rates now.

MYTH 3 : FHA LOANS REQUIRE 20 PERCENT DOWNPAYMENT

Fact : FHA loans do not require a 20 percent downpayment.

For home buyers, FHA mortgages require a 3.5 percent downpayment with the fewest "strings" attached. This makes the FHA mortgage one of the most lenient mortgage types available nationwide.

There are very few credit restrictions with the FHA loan and the agency allows your 3.5% downpayment to comes as a gift from a family member, employer, charitable organization or government home-buyer program.

Other low-downpayment mortgage programs have eligibility requirements. The VA loan, for example, allows for 100% financing but you must be an eligible military borrower to use it.

The USDA Rural Development loan also allows 100% financing but the USDA program requires that your home be in a less-developed census tract; and that your household income is within certain limits.

Fannie Mae's former 3% downpayment program -- the Conventional 97 -- required higher credit scores than an FHA loan, and loan sizes were limited to $417,000. In 2014, FHA loans are available for loans of up to $729,750 for streamlined refinance.

In 2014, FHA loan limits drop.

MYTH 4 : FHA LOANS REQUIRE HIGH CREDIT SCORES

Fact : Lenders can approve FHA loans with no credit score whatsoever.

FHA loans feature some of the flexible and forgiving credit standards of any available loan type. With an FHA-backed loan, perfect credit is not required, and mortgage lenders are expressly instructed to consider a borrower's complete credit history --  not just isolated instances of late payments here and there.

You can get an FHA loan if you've recently experienced a short sale, foreclosure or bankruptcy via the FHA Back to Work program. Sometimes, a waiting period is required, but not always. Depending on your personal circumstances, you may be eligible to purchase another home using FHA financing right away.

Since 2011, FHA mortgage rates have been lower than comparable conventional products.

Note that not everyone will qualify for an FHA home loan. Borrowers with a "banged-up" history, though, have a much better chance of getting loan approval via the FHA than other government agencies.

Even if you've been turned down for other types of credit, such as an auto loan, credit card or other home loan programs, an FHA-backed loan may open the door to homeownership for you.

Click to get pre-approved for an FHA loan.

MYTH 5 : FHA LOANS ARE EXPENSIVE

Fact : FHA loans can be more expensive, or less expensive, than other loan types. The long-term cost of an FHA loan depends on your loan size, your downpayment, and your location.

The biggest cost of an FHA home loan is usually not its mortgage rate -- FHA mortgage rates are often less than comparable conventional mortgage rates via Fannie Mae and Freddie Mac. The biggest cost is FHA mortgage insurance.

FHA mortgage insurance premiums (MIP) are payments made to the FHA to insure your loan against default. MIP is how the FHA collects "dues" to keep its program available to U.S homeowners at no cost to taxpayers.

MIP is paid in two parts. The first part is paid at closing and is known as Upfront MIP. Upfront MIP is automatically added to your loan balance by the FHA so no payment is required at settlement. Upfront MIP ranges from 0.35% of your loan size to 1.5% of your loan size. Your loan traits determine your MIP cost.

The same is true for annual mortgage insurance premiums, which are paid in monthly installments along with your mortgage payment.

Annual MIP can range as high as 1.55% in high-cost areas such as Orange County, California; Potomac, Maryland; and, New York City, New York. For most borrowers, MIP is between 0.45% and 1.35% annually.

As compared to conventional loans with less than 20% downpayment, FHA MIP is sometimes more costly and sometimes less so. Your loan officer can help you compare choices.

MYTH 6 : ALL FHA LOANS ARE THE SAME

Fact : All FHA loans are not the same. There are many "types" of FHA loans, and mortgage rates vary by lender.

As an agency, the FHA publishes and maintains minimum eligibility requirements all of the loans it insures. However, FHA lenders enforce additional requirements on FHA loans, known as "investor overlays."

A sample of investor overlays includes raising the minimum FHA mortgage score requirement; or, requiring additional time since a bankruptcy, short sale, or foreclosure; or requiring employment verification for an FHA Streamline Refinance transaction.

Because of overlays, when you've been turned down for an FHA mortgage by Lender A, you should always try to apply with Lender B which may approve your FHA loan request. Plus, mortgage rates can be very different from bank-to-bank.

In addition, the FHA offers special refinance loans, home construction loans, and various benefits to eligible applicants.

CHECK YOUR FHA ELIGIBILITY TODAY

The FHA insures home loans in all 50 states, in the District of Columbia, and in many U.S. territories including Puerto Rico, Guam and the U.S. Virgin Islands. Whether you're a first-time buyer or an experienced one, an FHA-insured mortgage may be your best home financing option.

See today's FHA mortgage rates to see how FHA loans can help you. Getting rates online is fast and free and no social security number is required.

Click to get today's live FHA mortgage rates now.

Contact The Mortgage Mark with any questions!!

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7 Things You Still Don’t Know About HARP 2.0, Plus How To Apply For The Mortgage

• HARP MORTGAGES

The Home Affordable Refinance Program (HARP) has reached more than 3 million households in its first 4 years. However, the program has not reached as many U.S. homeowners as it should.

The limited reach of HARP has two potential causes. The first is that the program may be too restrictive; too few people qualify. The second is that too few people choose to apply.

There are millions of HARP-eligible households nationwide which have yet to refinance.

See today's live HARP mortgage rates.

THE BASICS OF HARP 2.0

In 2009, the government launched its Home Affordable Refinance Program (HARP) as part of that year's economic stimulus program. HARP was meant to give homeowners access to a refinance despite having little or no home equity.

The eligibility test for HARP was basic.

In order to qualify for HARP, homeowners had to show their current mortgage was backed by Fannie Mae or Freddie Mac on, or prior to May 31, 2009; that their mortgage payment history was strong; and that their home's loan-to-value was 125% or lower.

Between 2009-2011, HARP reached close to one million households. It would have reached more than one million households, it was determined, if not for the 125% loan-to-value restriction, and for a specific HARP clause which increased a mortgage lender's typical mortgage liabilities.

So, to reach more households, HARP 2.0 was released.

HARP 20 was an improvement upon HARP 1.0. It removed the 125% loan-to-value restriction which helped homeowners in hard-hit states such as Florida, Nevada and California get access to the HARP program. It also removed the lender liability clause which had slowed HARP's adoption.

Program changes were a hit. HARP 2.0 closed as many loans in its first 12 months as the original HARP 1.0 closed in its first three years.

However, even today, HARP is closing fewer loans than it should. HARP misconceptions are limiting the program's reach.

Click here to get HARP mortgage rates.

WHAT YOU DON'T KNOW ABOUT HARP 2.0

The government is going on the offensive.

Fannie Mae and Freddie Mac recently launched a HARP public relations campaign meant to educate U.S. homeowner about the HARP program's benefits. The agencies believe that the majority of HARP-eligible homeowners are either unaware that the program exists, don't know about the program benefits, or both.

This website receives a lot of emails from homeowners wondering about HARP and whether they're eligible to refinance. Here are some of the common HARP misconceptions.

I can't refinance with HARP if I have a second mortgage.

Yes, you can refinance with HARP if you have a second mortgage. However, in accordance with HARP guidelines, you cannot combine your two mortgages in a cash-out refinance.

To refinance your first mortgage via HARP, but leave your second mortgage unchanged, your second mortgage lender will agree to subordinate its mortgage, which is a fancy way of saying that second mortgage lender will give permission for you to replace the existing first lien on title. 

I have no equity in my home so I can't refinance with HARP.

Yes, you can refinance your home via HARP if you have no equity. That's exactly the premise of the program! Via HARP 2.0, homeowners can refinance no matter how far underwater they are with their mortgage. This is among the reasons why the HARP refinance has been so popular in Las Vegas, Nevada; Phoenix, Arizona; and other hard-hit areas. HARP is the "underwater mortgage program" -- of course you can use it when you have no home equity. 

I was already turned down for HARP. I won't get approved if I apply for HARP again.

Even if you've been turned down for HARP in the past, it can make sense to apply for HARP again. This is because HARP-approved lenders often use in-house variations of the official, government-issued HARP guidelines. These variations differ from bank-to-bank. If you were turned down by Wells Fargo, for example, you may be able to get approved by Quicken. If at first you don't succeed, apply, apply again.

I can't refinance my home via HARP because it's not my primary residence.

HARP 2.0 can be used to refinance homes of any occupancy type. Investment properties can be refinanced via HARP, and so can second homes and vacation properties. HARP can be used in all 50 states, the District of Columbia, and all U.S. territories. 

I can't use HARP because my lender doesn't offer it.

Not all lenders offer The Home Affordable Refinance Program; this is true. However, U.S. homeowners are free to refinance with any HARP-approved lender. This freedom was among the improvements of HARP 2.0. There are thousands of lenders making HARP 2.0 mortgages. You can get mortgage rates for a HARP loan here.

I can't use HARP because I am not behind on my mortgage payments.

The HARP refinance program is not meant for homeowners who are behind or delinquent with their mortgage payments. HARP can only be used for homeowners who are current. The HARP program is not meant to save a person's home from foreclosure. Homeowners facing difficulty with payment should contact their loan servicer immediately.

I can't use HARP because my loan has mortgage insurance.

You can use HARP 2.0 for loans with existing private mortgage insurance (PMI). This is a change from HARP 1.0 and applies to loans with both borrower-paid mortgage insurance (BPMI) and lender-paid mortgage insurance (LPMI).  However, it can be difficult to find banks to offer a PMI program. If you try to refinance your loan with PMI and you are turned down by a lender, apply again somewhere else. You may get a better outcome.

ARE YOU HARP 2.0-ELIGIBLE BUT DON'T KNOW IT?

There are an estimated remaining 4-plus million households nationwide who could refinance via HARP, but haven't. Some of these 4 million households are unaware that HARP 2.0 exists. Others are unaware that they'd qualify.

Check whether you'd qualify for HARP 2.0 and see today's mortgages. Get started online. It's fast, and free, and there's no obligation.

Click here to get started with HARP.

Contact The Mortgage Mark with any questions!!!   www.themortgagemark.com  

10 Bona Fide Benefits Of Taking A VA Loan, Plus Today’s VA Mortgage Rates

• VA MORTGAGES

Multiple loan "programs" exist for today's home buyers. Some programs are backed by the U.S. government and some are backed by individual lenders.

And, although each can you meet your specific mortgage loan needs, one loan type stands apart for its combination of low rates, aggressive underwriting and secondary benefits.

That program is the VA loan from the Department of Veterans Affairs. VA loans are a key part of the 2014 housing market.

Click here for VA mortgage rates.

VA LOAN : BETTER THAN FHA AND CONVENTIONAL?

Backed by the U.S. Department of Veterans Affairs, VA loans are designed to help active-duty military personnel, veterans and certain other groups become homeowners at an affordable cost. The VA loan asks for no down payment, requires no mortgage insurance, allows flexible guidelines for qualification among its many other advantages.

Here's an overview of the 10 biggest benefits of a VA home loan.

1. NO DOWNPAYMENT

Most home loan programs require you to make at least a small downpayment to buy a home. The VA home loan is an exception. Rather than paying 5, 10, 20 percent or more of the home's purchase price upfront in cash, with a VA loan you can finance up to 100 percent of the purchase price. The VA loan is a true no-money-down opportunity.

2. NO MORTGAGE INSURANCE

Typically, lenders require you to pay for mortgage insurance if you make a downpayment that's less than 20 percent. This insurance, referred to as private mortgage insurance (PMI) for a conventional loan or a mortgage insurance premium (MIP) for an FHA loan, protects the lender in the event that you default on your loan. But a VA loan neither a no down payment nor mortgage insurance. That makes this a VA-backed mortgage very affordable upfront and over time.

3. U.S. GOVERNMENT GUARANTEE

There's a reason why the VA loan comes with such favorable terms. The federal government guarantees that a portion of the loan will be repaid to the lender even if you're unable to make monthly payments for whatever reason. This guarantee encourages and enables lenders to offer VA loans with exceptionally attractive terms to borrowers that want them.

4. ABILITY TO SHOP AND COMPARE

VA loans are neither originated nor funded by the VA. Furthermore, mortgage rates for VA loans aren't set by the VA itself. Instead, VA loans are offered by U.S. banks, savings-and-loans institutions, credit unions and mortgage lenders -- each of which sets its own VA loan rates and fees. This means you can shop around and compare loan offers and still choose the VA loan that works best for your budget.

5. NO PREPAYMENT PENALTY

A VA loan won't restrict your right to sell your home if you decide you no longer want to own it. There’s no prepayment penalty or early-exit fee no matter within what time frame you decide to sell your home. Furthermore, there are no restrictions regarding a refinance of your VA loan. You can refinance your existing VA loan into another VA loan via the agency's Interest Rate Reduction Refinance Loan (IRRRL) program or switch into a non-VA loan at any time.

6. LOAN OPTIONS

A VA loan can have a fixed rate or an adjustable rate. It can be used to buy a house, condo, new-built home, manufactured home, duplex or other types of properties. Or it can be used to refinance your existing mortgage, make repairs or improvement to your home or even make your home more energy efficient. The choices are yours. A VA-approved lender can help you decide.

7. EASY TO QUALIFY

Like all mortgage types, VA loans require specific documentation, an acceptable credit history and sufficient income to make your monthly payments. But, as compared to other loan programs, VA loan guidelines tend to be more flexible. This is made possible because of the VA loan guaranty. The Department of Veterans Affairs genuinely wants to make it easier for you to buy a home or refinance.

8. LOWER CLOSING COSTS

The VA limits the closing costs lenders can charge to VA loan applicants. This is another way that a VA loan can be more affordable than other types of loans. Money saved can be used for furniture, moving costs, home improvements or anything else.

9. FUNDING FEE FLEXIBILITY

VA loans require a "funding fee", an upfront cost based on your loan amount, your type of eligible service, your down payment size plus other factors. Funding fees don't need to be paid as cash, though. The VA allows it to be financed with the loan, so nothing is due at closing. And not all VA borrowers will pay it. VA funding fees are normally waived for veterans who receive VA disability compensation and for unmarried surviving spouses of veterans who died in service or as a result of a service-connected disability.

10. ASSUMABLE FINANCING

Most VA loans are "assumable," which means you can transfer your VA loan to a future home buyer if that person is also VA-eligible. Assumable loans can be a huge benefit when you sell your home -- especially in a rising mortgage rate environment. If your home loan has today's low rate and market rates rise in the future, the assumption features of your VA become even more valuable.

Click here for VA mortgage rates.

COMPARE VA MORTGAGE RATES 

The eligibility list for a VA loan is long. Classes and classes of servicepersons and their families are eligible.

Whether you're an active-duty serviceperson, a veteran, a member of the National Guard, a Reservist or surviving spouse of a veteran; or if you're a cadet at the U.S. Military, Air Force or Coast Guard Academy, midshipman at the U.S. Naval Academy or officer at the National Oceanic & Atmospheric Administration, you may be eligible for a VA loan -- plus all the benefits that come with it.

See today's VA mortgage rates and compare your VA offers. 

Contact The Mortgage Mark with any questions!!

mark@themortgagemark.com   www.themortgagemark.com