There are very few mortgage programs available that offer 100% financing.

This is one of the most important benefits of a VA mortgage as you are not required to make a down payment and you will never need to pay mortgage insurance.

There is a consequence to 100% financing, though: it means a higher funding fee.

Here's how the VA loan program works when it comes to your down payment.

NO DOWN PAYMENT

IS NECESSARY

You are not required to make a down payment with a VA loan. The VA loan program is one of the only options available with no down payment required.

While 100% financing is possible, even with reduced underwriting requirements compared to other loan programs, it's still a good idea to put down as much as you can.

This can reduce your interest rate, your VA funding fee, and the amount of interest you pay.

VA LOANS DO NOT HAVE

MORTGAGE INSURANCE

With most loan programs, such as FHA loans, USDA loans, and conventional mortgages, you must pay for mortgage insurance if you put down less than 20%.

Mortgage insurance is a type of policy that protects the lender if you default and it can be very expensive, adding up to $100 or more to your monthly payment.

With conventional and USDA loans, you can eventually have the mortgage insurance removed once you reach 20% equity -- a process that can take years.

With VA loans, mortgage insurance is permanent unless you refinance.

VA mortgages never have mortgage insurance, even if you choose 100% financing.

FUNDING FEES AND

YOUR DOWN PAYMENT

The VA funding fee is a unique cost to a VA loan. This fee is applied to all VA loans and it helps cover expenses on the loans that go into default.

The good news is the funding fee is generally very low, especially compared to the cost of mortgage insurance and the higher interest rates of other mortgage programs.

Regular military members have a lower funding fee than National Guard members and Reservists.

The fee is also lower if it's your first time using your VA loan entitlement; the fee increases with subsequent uses.

The final factor that determines your funding fee is your down payment.

For example, the funding fee for a first-time use with 100% financing is 2.15%, but this fee goes down to 1.5% if you put down 5% to 9.9% and down to just 1.25% if you put down at least 10%.

If it's your second or subsequent use of your entitlement, the fee is 3.3% with no down payment but the same 1.5% with a 5% down payment or 1.25% with at least 10% down.

While the funding fee can add thousands to your loan, it can be rolled into your mortgage -- even if you put 0% down. This means you can get 100% financing with a VA loan and pay very few out-of-pocket costs.

When compared with low down payment mortgage options like USDA loans and FHA loans, VA loans are the most affordable option, both in terms of upfront costs and monthly costs.

You can buy a home with 0% down, roll your funding fee into your loan, and even have the seller pay some or all of the closing costs with potentially no out-of-pocket expenses at closing.

Mortgage Originator JimmyVercellino, specializing in VA loans, helps veterans use their VA loan benefit to their greatest advantage.

Be a proud homeowner today.

For more details call 480-351-5904 or visit the site www.valoansforvets.com

VA Loans for Vets7600 E. Doubletree Ranch Road #200Scottsdale, AZ 85258Phone: (480) 351-5904Email: jimmyv@fcbmtg.com