If you’re a coupon-clipping, discount-hunting, “never pay full price” kind of shopper, you probably know the cheapest way to purchase anything.
But did you know there are also ways to cut VA loan costs? From improving your borrower profile to bartering with a seller, there are several ways to shave costs from your home loan.
Take a look at three tried-and-true cost-cutting measures, and make sure you’re working with an experienced VA lender and a trusted real estate agent for the best results.
VA loan closing costs typically range from 3-4 percent of the total loan amount. That means that military buyers could be asked to fork over $6,000-$8,000 at the closing table.
But we’ll let you in on a little secret: the majority of VA loan borrowers at Veterans United don’t pay anything out of pocket on closing day. That’s because they take advantage of a common negotiation tactic and VA loan benefit. They ask the seller to pay closing costs.
And don’t be shy. It’s one of the most common negotiation requests, and it’s often granted.
A borrower with a low credit score represents more risk for lenders. Lenders will make marginal borrowers pay a higher interest rate to cover that risk.
An applicant who builds a solid credit history backed by a superior credit score, on the other hand, is a lender’s dream. Those are the borrowers who secure the best rates and the lowest monthly payments.
Borrowers with scores in the 700s can sometimes grab rates 1 1/2 percentage points below the sub-prime rate. Check out what a difference those 1 1/2 points can make:
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Borrowing money costs money. The most direct way to slash those costs? Pay off your debt.
By building equity in your home, you reduce the amount of interest you’ll have to pay. And you don’t have to pay your mortgage off in one big chunk. Simply diverting a few extra dollars to your loan can make a big difference. Here are some common ways borrowers chip away at their mortgage debt:
When you’re ready to purchase, make sure to get an estimate of your anticipated loan fees and costs. Shop around, but understand that fees won't tell the whole story of a lender.
To get an early look at your projected VA loan costs, contact Veterans United at 855-870-8845 or via www.VeteransUnited.com.
Your Certificate of Eligibility (COE) verifies you meet the military service requirements for a VA loan. However, not everyone knows there are multiple ways to obtain your COE – some easier than others.
Credit score requirements vary by lender. However, most lenders have similar criteria. Let's look at the minimum credit score for a VA loan and what lenders typically expect.