Top 5 Perks of a VA Loan – What to Know

Top 5 Perks of a VA Loan – What to Know

VA loans, which take their name from the United States Department of Veteran Affairs, are home loans offered exclusively to members of the US military. To take advantage of a VA loan, one does not have to be on active duty. However, the USDVA does prescribe an active-duty service requirement based on when you served.

Technically, VA loans are not provided by the government. Instead, it works with third-party mortgage loan providers and guarantees a portion of that loan. Given its intended purpose, VA loans have several unique perks afforded to veterans and active service members alike.

To emphasize that point further, here are five benefits of applying for a VA loan:

Surviving spouses may apply

In order to cope with the realities of life that come with the service, VA loans can be applied for by a surviving husband or wife as well, even if the service personnel did not die in the line of duty.  This is courtesy of H.R. 1627, also known as “The Honoring America’s Veterans and Caring for Camp Lejeune Families Act.”

According to, this applies if the veteran was “rated totally disabled and eligible for compensation prior to death by any cause.” This is important because prior to the law’s signing on August 6, 2012, only surviving spouses of personnel who died due to military causes were eligible. 

Waived down payments 

Unless the residence purchase price is above the property value, VA loans usually do not require down payments. This helps service members secure home loans more easily, especially those who may not have enough cash to make the standard 20% down payment. 

Lower mortgage interest rates 

VA loans are even more generous than other federal loans, especially when it comes to mortgage interest rates. This translates into shorter payment terms and significant savings per month.

This is important to point out, given that even a $50 in monthly savings means $15,000 of extra pocket cash for a 25-year mortgage!

Flexible credit score standards 

Your credit score is a number that ranges from 300 to 850 that lenders use as one of the qualifications for granting you a mortgage. The higher the score, the better your chances of securing a loan.

According to Investopedia, your credit score is determined by five main factors. These factors are payment history, total debt, type of credit you use, length of credit history, and a category called new credit. New credit factors in how many new accounts you have opened recently, how many new credit accounts you have applied for recently, and when the newest account was opened.

Most conventional loans will require an excellent credit score (about 740 or higher) to be granted a loan with a low down payment and mortgage interest rate. Any lower than that and you’d need to pay higher down payments and interest rates, maybe even needing a cosigner just to get approved.

Meanwhile, because part of the VA loans is guaranteed by the government, participating lenders will usually start at around the 620 mark, which conventional lenders generally consider as high-risk borrowers. 

No need for mortgage insurance payments 

Another perk offered by VA loans is the ability to do away with private mortgage insurance (PMI) payments. Like lower interest rates, this also translates to significant savings, since PMIs usually add up to 1% of the purchase price. This means that if a veteran were to buy a $150,000 property, he would save up to $1,500!


Serving in the military entails a lot of sacrifices, both for the military service person and to his or her family. The good thing is that the government has programs like the VA loans, which helps veterans secure a home for them and their families easier.

Are you looking for mortgage professionals to help you understand your finance options in getting a loan? Frontline Financial offers the best mortgage rates in Salt Lake City. We also specialize in assisting veterans in buying their new homes. Contact us today and see how we can best help you.