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The Miracle of the VA Mortgage


VA MortgageWhen you buy a car, you read the consumer reports. When you buy a computer, you research pricing and features. When people are fully aware of their options—the long-term and short-term benefits and costs—they can make an informed decision. Without knowledge, you have to either rely on guesswork or the opinions of others—many of whom may not view your best interest as a priority.

This fact applies to mortgages as well. Consider the VA mortgage (“VA” standing for “U.S. Department of Veterans Affairs”). In honor of the sacrifices made by veterans and active duty personnel, qualified borrowers are allowed by the government to enjoy special mortgage deals. The VA mortgage generally has lower interest rates and smaller down payments than regular loans. Furthermore, those qualified can receive loans larger than typically allowed by Fannie Mae, Freddie Mac, and other Government-Sponsored Enterprises (GSEs). For more information on VA mortgages, Real Estate consulting click here.


However, oftentimes veterans and active duty personnel are not even made aware that a VA mortgage is an option. Either the VA mortgage is never mentioned, or if they are, they are glossed over quickly by an agent more interested in pushing other options.

Our veterans deserve to know the full range of their alternatives, and I urge you to be your own advocate and do as much research as possible on the topic. For now, take a look at this example, which illustrates the differences between a VA mortgage and a regular non-conforming jumbo loan. Both loans have a comparable using limit and home price, but the interest rates and out-of-pocket expenses are very different.


Non Conforming 30 year Jumbo Loan VA Mortgage 30 year Jumbo Loan
using limit of $417,000 using limit of $417,000
Price of Home $617,000 Price of home 617,000
Down Payment (20%) $123,400 Down Payment (8.1%) 50,000
Loan Amount $494,000 Loan Amount 567,000
Interest 5.625% Interest 5%
FICO Score 740 FICO Score 640
P & I Payment $2843 P & I Payment $3,043
Funding Fee N/A $0 Funding Fee 3.3% $18,711
Approximate Out of Pocket Exp/Cash $123,400 Approximate Out of Pocket Exp/Cash $68,711

(Take note that closing costs/prepaid expenses are not included for comparison purposes because they have an equal impact for both loans).


The reason we call it the “Miracle of the VA mortgage ” is because when you compare the VA loan to the other non-conforming Jumbo loan, the difference is truly remarkable.


The cash-to-the-table cost is almost twice as much for the traditional mortgage. And a FICO score one hundred points less still allows the VA borrower to secure a lower interest rate than that of a typical borrower.


Are you interested in learning more about the VA mortgage, or would you like to be guided toward resources you might not have even realized you had? Call Ashok Ghildyal toll-free at 866-993-6379 x250 or shoot an email to connect@vamortgagebenefits.org. I look forward to hearing from you!
Additional Resources:

VA MORTGAGE: Article on Companynewsengine.com
VA MORTGAGE: Listed on Incwebstats.com

VA MORTGAGE: Article on Profileleadercorp.com

VA MORTGAGE: Information on Incnewstoday.com

VA MORTGAGE: Profile on Corporateinfotoday.com