Nearly 9 Out of 10 Veterans Fail To Take Advantage Of This "Hidden" Benefit:
5 Myths Exposed About VA Home Loans
It’s an unfortunately little-known fact: There’s a program designed to give those who have served in the U.S. armed forces a well-earned leg up on the American dream of homeownership. In an effort to increase home buying among members of the military, the Administration of Veterans Affairs Home Loan program offers significant advantages over other types of mortgages.
The VA loan, as it’s commonly known, is available to veterans as well as active-duty service members and requires no down payment, and other debts can often be consolidated within it. Because the default rate for VA home loans is about one-tenth that of other mortgages, interest rates are often lower than FHA or conventional mortgages.
Everyone profits from it — buyers, sellers and lenders — yet the program is underutilized. Commonly, veterans don’t even realize that they still have the opportunity to use a VA home loan.
“Veterans have earned that benefit, and some of them don’t even know about it,” said John Prazynski, a U.S. Air Force veteran and senior sales vice president at Star One Realtors in Fairfield, Ohio. “If an agent hasn’t [worked with a VA loan], fear of the unknown can prevent them from moving forward with their veteran clients.”
Ken Teglia, of Vernon Hills, Ill., is an insurance executive and U.S. Army veteran who served in Vietnam and bought his first house with a VA loan. Recently, he wanted to refinance his current home, so he looked for the best rate online and spoke with a loan officer.
“I mentioned I was a vet,” Taglia said, “and he kind of blew me off. Sounded like he didn’t want to go through the (process).”
By chance, another loan officer who turned up in Teglia’s search was someone who specialized in VA loans. The successful refinancing saved Teglia about $12,000 a year.