Imagine stepping into your new home with no down payment, no private mortgage insurance, and a lower interest rate — sounds appealing, right? 

That’s the reality for many veterans and active-duty service members thanks to U.S. Department of Veterans Affairs loans. 

However, myths and misconceptions often cloud their true potential.  

UnitedOne Credit Union’s team of Local Home Loan Experts clear the air and explore why VA loans are a great option to homeownership for those that served our country.

“The Federal VA program is a great program if you’ve been in the military,” said UnitedOne Mortgage Specialist Kari Johnsrud, NMLS # 441414. “The biggest benefits to you are that you don’t have to have a down payment and you don’t have to pay private mortgage insurance as part of your monthly payment. It’s a fixed-rate loan program designed specifically for Veterans that can get you into a house without having to worry about those extra costs or having to come up with a chunk of money.” 

VA loans typically feature lower interest rates compared to conventional loans, resulting in substantial savings over time. 

There are closing costs, but a gift from an eligible family member can be used to cover that. There is also a funding fee, which can be added to the loan or waived completely if you’re receiving disability through the VA. 

“Ultimately, you can get into the home with zero dollars if you qualify, so it’s a great program to have,” said UnitedOne Mortgage Specialist Linda Serrano, NMLS # 441416. 

Despite these advantages, some view VA loans negatively, believing they are meant only for “subprime” borrowers. 

In reality, while VA loans have more flexible credit requirements, they cater to responsible borrowers who have often faced unique challenges due to their service. Many Veterans have excellent credit scores and solid financial backgrounds. 

“I know sometimes VA gets a bad rap amongst purchasing homes,” said UniteOne Mortgage Specialist Julie Peot, # 441412. “Sometimes the sellers are like, ‘Nope, I’m not dealing with that. They’re too picky. It’s going to be a problem.’ Overall, me personally, with the VA loans I have done, I haven’t had a whole lot of issues come up.” 

A specific type of appraisal needs to be done for a VA loan to ensure the home is in good living condition. 

“The advantage to it, it’s very thorough,” Johnsrud said. 

“Unfortunately, some other parties in the transaction will try to sway people away from the program, but it really is a good program. It’s really not a terrible underwriting process. You’ve got to remember it’s out there to benefit our Veterans so they should be able to use it.” 

Ultimately, dispelling myths around VA loans can empower more Veterans to take advantage of the opportunities they provide, paving the way for greater financial stability and a brighter future. 

“If you’re in a VA loan now, there are refinance options that are still at 100% loan to value,” Peot said. “If you’re looking for maybe a debt consolidation or improving the property, whatever the case, you could still do a cash out with a VA. That you can go up to 90%, unlike other programs. So, it’s not just designed for the purchase, it can be a refinance as the rates go down or even cash out.” 

As is the case with any type of home loan, it’s best to discuss your situation and options prior to putting in an offer on a house. The Local Home Loan Experts at UnitedOne Credit Union will help you navigate the process and are your trusted source in Manitowoc and Sheboygan for all your home loan needs. 

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