Veterans can come home to homeownership

Qualifying for a mortgage has become difficult for most borrowers, especially for today’s first-time homebuyers. Whatever the reason – low FICO scores, too much student loan debt, low incomes, or short credit histories — the doors to homeownership have all but closed for first time buyers. 

Yet there’s a special class of new first time homebuyers whose numbers have been growing in recent years thanks to a government program that began 70 years ago and is still going strong: VA loans. VA loans have been financing homes for three generations of service men and women who have earned this benefit through their service to our country. 

{mosads}While the total market share of first time homebuyers has been in steady decline in recent years, the number of first-time homeowners financed by VA-guaranteed loans from loanDepot has increased every year since 2010. In fact, the number of VA loans funded by loanDepot to first time buyers has increased by 27 percent from 2012 to today. 

Because of the VA guarantee, requirements to qualify are much more attractive than conventional mortgages. VA loans are perfect for eligible veterans and active military personnel who want to buy a first home and have no money for a down payment. Monthly payments are generally lower on VA loans because mortgage insurance isn’t required and they come with lower interest rates.  

Millions of veterans may also be missing out on one of the most important benefits of the VA loan program: VA Interest Rate Reduction Refinance Loans, also known as VA Streamline Refinance or IRRRL. This VA-to-VA refinance loan is easy to apply for, does not require out of pocket cash and can be used to refinance a home down to a lower interest rate even if there is no equity in the property. The VA Streamline program is a valuable benefit for those who want to take advantage of today’s lower interest rates even if their property value has suffered. 

The VA loan program is one of the best mortgage products on the market today.  But not enough eligible veterans or active military personnel realize what a tremendous advantage it gives them over conventional financing.  

Veterans and active military personnel have earned this benefit through their courageous service to our country. They should understand how the VA loan program works, and why they are superior in today’s challenging lending environment, especially for first time homebuyers. 

Hsieh is the CEO and chairman of loanDepot, LLC, the nation’s second largest nonbank consumer lenders.