First off, thank you very much for your service to this great nation of ours!!
One of the many benefits for your service is your eligibility to purchase a home with no money down with a VA-guaranteed loan. This is a huge benefit as a VA loan is by far the best way for someone to purchase a home. So congratulations on having the keys to the kingdom in the home purchase world!
That’s right, you can purchase a home for no money down. A good real estate agent (we have a great referral for you if needed) will negotiate the seller to cover all of your closing costs, prepaid expenses and reserves. All you have to come up with is earnest money to secure the deal which will be refunded back to you at closing.
Your loan is guaranteed by the VA so lenders give you the best interest rates…even with less than perfect credit. No mortgage insurance premiums. You would normally have to put 20% down to get around paying mortgage insurance. There is no mortgage insurance due on a VA loan.
The only down side to a VA loan is that you have to pay a funding fee. The funding fee varies depending on a number of factors:
Veterans pay less than National Guard & Reserve Members
First time users pay less than subsequent users
Putting money down will reduce your funding fee as well
The good news is that you can finance the funding fee into your loan amount.
There are two sides to every coin. All in all this is a small price to pay as the many benefits definitely outweigh the funding fee.
A lot of people (even in the mortgage & real estate business) don’t know that you can have more than one VA loan. The VA loan limit in Alaska is $625,500. You can have combined VA loans for up to the VA loan limit. For example, if you previously purchased a home using your VA eligibility and borrowed $200,000, you have an additional $425,500 in eligibility ($625,000 less $200,000 = $425,500).
This can be a huge selling point if the interest rates are much higher when you put your home on the market as prospective buyers can assume your VA loan. And they don’t have to have VA eligibility to do so.
You can pay extra towards the principal on your loan at any time without ever incurring a prepayment penalty.
Alaska is considered an overseas duty station which means your BAH (Basic Allowance for Housing) is higher than most other places in the US. If you live on post you get to live for free but forgo your BAH. You can purchase a nice home for less than what you are forgoing for BAH meaning you can put the extra money in your pocket.
The VA also allows you to purchase an income property (up to a four-plex). You can live in one unit and have your tenants pay a portion of, or maybe all, your mortgage payments.
You can do what you want to your home. After all, you own it!
Homeowners have a higher net worth than renters. You get to build equity in your home through property appreciation and principal pay down. There are also several income tax deductions that come along for the ride when you own a home.
The first order of business is getting you pre-approved for VA financing. Step one is to complete a loan application. We can do this over the phone or online. We will contact you once the loan application is complete to take the next step.