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At PenFed Credit Union, we believe it’s essential for everyone to have the American dream of homeownership within reach — particularly those who have served our nation. That’s why we participate in the VA loan program for veterans and current members of the military.
VA mortgages offer excellent rates with a low — or even no — down payment. Because VA loans are guaranteed by the Department of Veterans Affairs (VA), no private mortgage insurance is required. As a result, both your upfront costs and your monthly payments can be lower than they would be with a traditional loan. In addition, VA loans have no prepayment penalty.
Requirements and Restrictions
In order to qualify for a VA loan, you must acquire a Certificate of Eligibility (COE) from the government. Most current and former members of the U.S. military, including reservists and National Guard members, are eligible for VA loans. In some cases, surviving military spouses may also be eligible.
There are some funding fees and other costs associated with a VA loan, but they tend to be much lower than normal down payment costs and may be waived in some cases. You can check with the VA for full details.
In general, VA loans can be used for the same types of properties you would buy with a regular mortgage. You can use a VA loan for a for single-family home or condo, to build a home, or to refinance an existing home loan. There are some restrictions however, so be sure to check with your credit union regarding the type of home you’d like to buy.
When you apply for a VA loan, you will need to go through a credit check, so it’s a good idea to check your credit score and do anything you can to improve it prior to applying.
If you’re a first-time homebuyer and a veteran or active duty military member and the upfront costs of purchasing a house still seem too great, consider applying for a Dream Makers grant from the PenFed Foundation. These grants help cover fees and closing costs for service members of modest means. The amount of the grant is determined by a 2-to-1 match of your contribution, with a maximum grant of $5,000 and a minimum outlay of $500.
The Foundation, which is dedicated to providing financial literacy and financial assistance to the men and women of our armed services, makes it easy to apply for these grants online. Equal Housing Opportunity.
Please note, funding is limited and based on availability.
A PenFed associate would be happy to walk you through your home buying options. Just call 800-970-7766 or visit PenFed.org.
PenFed Credit Union is federally insured by NCUA and is an equal housing lender.