Veterans are some of the most important people in America. But unfortunately, they don’t always get the respect that they deserve. Nor do they get many benefits for having risked their lives to serve our country, and many other countries around the world.
Luckily, one place where they do get preferential treatment is the loan industry. Specifically, veterans get access to the best possible mortgage deal in America, known as the VA loan.
And while VA mortgages are the most common loans for veterans, they aren’t the only loan options available for veterans. Keep reading below to learn more about veteran financial assistance today, and to see what opportunities are available to you.
VA Home Loans
Again, the most common type of loan made available exclusively to past or present military service members is the VA home loan.
This is a mortgage loan that is guaranteed (or insured by) the Department of Veterans Affairs, aka the government. They don’t provide the funding. Normal mortgage lenders, such as banks provide the loan.
But mortgage lenders are able to offer this loan thanks to the guarantee from the VA to pay them back, should you default on the loan.
What makes this loan so special? It’s the only mortgage loan that allows qualified borrowers to buy a house for a 0% down payment.
That means you don’t need to put any cash down, though you will need to pay for some of the closing costs.
Normally, when borrowers put less than 20% down on a home purchase, they are required to pay private mortgage insurance (PMI), which is an additional monthly payment.
But VA loans don’t require it. Plus, interest rates are very low, another perk of these loans.
If you’re a veteran, this is one opportunity you don’t want to miss. And your benefit stays with you, long after your time of service. You can use it again and again as you move throughout your life.
Obtaining a VA Loan
To get a VA loan, the home you are purchasing needs to act as your primary residence. It can’t be a vacation home, second home, or rental property.
However, if you’re goal is to generate income from the property, you are able to purchase a duplex, triplex, or quadplex, and rent out the remaining units while living in one unit.
This can be a great way for veterans to live mortgage-free, or even generate a profit while living at home.
The home also needs to be conventional, and in good repair. No rundown homes that aren’t considered liveable at the money. And no geodesic domes or converted churches or barns will qualify for this program.
Individual lenders will set their own credit score requirements. If you have a low score, apply with multiple lenders to see if you can get approved.
There is also a database of condo associations that qualify for VA loans if you don’t plan to purchase a single-family home.
To get started with a VA loan application, you’ll need a Certificate of Eligibility (COE), which you can obtain through your benefits portal. You can check your eligibility status on the VA website.
Personal Loans for Veterans
Taking out a loan for a home isn’t the only option for those with veteran status. Personal loans are available as well.
Personal veteran loans function the same as standard personal loans. However, the rates and terms are more favorable.
You’ll get access to fast cash. You’ll likely pay lower rates than those applying for a standard personal loan. And the better your credit score and borrowing history, the lower it will be.
Not all lenders offer personal loans specifically for veterans. You’ll need to do some research as to which lenders off this great deal.
Business Loans for Veterans
After their time of service, many veterans look to put the skills and discipline they’ve acquired to good use. Starting a business is one of the best ways for veterans to stay motivated and focused, particularly after difficult spells of service or combat.
It’s by no means easy to start a business. But thankfully, business loans for veterans are available to help them get the jumpstart they need.
SBA loans are those guaranteed by the Small Business Administration. They offer loans up to $350,000.
There are many benefits to SBA loans for veterans over standard SBA loans. For one, they are processed and approved much faster than standard loan applications. Funding can happen in days, not weeks, if approved.
Also, the fees for taking out an SBA loan are much lower for veterans than other business owners.
For the most part, these loans are intended for existing businesses with at least two years of business history. The goal of these loans should be to expand your business, not to start one.
However, veterans that have a track record in the industry they are starting a business in may be eligible.
You can use the proceeds for real estate, working capital, purchasing equipment, and more.
Starting a Business as a Veteran
Starting a business is not an easy feat. The good news for veterans is that there is an ample amount of resources available to prepare them for the journey.
Numerous training programs are available for free to veterans to help them plan and start their companies. Some are offered by the SBA, though most operate through non-profit organizations.
There are even programs available to women veterans specifically.
Once you’re in business and are looking to expand, you can apply for SBA loans. The SBA doesn’t offer loans directly but guarantees them. YOu’ll need to find local lenders that offer SBA loans, such as banks or credit unions.
Veteran Status is a Lifelong Benefit
Certain lenders may offer additional loans for veterans, but these are the most common types of loans you’ll see. All of them offer benefits over standard loans.
So if you qualify for veteran status, or are close to qualifying, know that it will benefit you throughout your life.
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