The Lovely Truth Of Adjustable VA Loan Rates | Finance @ Redbright

The millions of military veterans and qualifying personnel that are receiving home financing through the VA programs are likely to have a few questions about the adjustable VA loan rates. ?Adjustable? has never been a word that potential homebuyers like to hear when talking about their financing rate for their mortgage. Fortunately for veterans, they don?t have anything to worry about when they hear the word ?adjustable,? because it doesn?t mean the same thing to them as it does for everyone else.

The big concern for a normal adjustable rate has always been the fact that they can adjust by an undetermined amount an undetermined number of times, making it impossible for the homeowner to know what their rate will be throughout the life of their mortgage. VA interest rates don?t function the same way that those others do, because there are rules in place to ensure that the rate only changes a little at a time and that it is never allowed to increase beyond a certain amount.

The first of these regulations is the fact that the rate is not allowed to be changed by more than one percent in either direction, whether it is being raised or it is being lowered. To make things even better, the rate can only be adjusted once every year, so the most you would have to worry about is an annual increase of one percent.

Now, you could be assuming that this still leaves room for your rate to increase to ten percent in ten years and even higher as time goes by, but that is a concern that you can confidently put out of your mind. The VA program places a cap on how much a rate can be adjusted for the entirety of the mortgage. Basically, with a cap being set at five percent, your rate could only increase for five years before it is blocked from ever increasing again without going back down first.

Thanks to these special regulations enforced by the Department of Veteran Affairs, military veterans and other military personnel can buy their homes with full knowledge of what to expect from the loans. You can be certain that this kind of loan is a rare gem in today?s housing market, so any veteran looking to purchase a home should definitely get their mortgage through a participating VA lender.

Utilizing your home loan benefits with the VA will provide you with unbelievable savings and opportunity through va loan rates as well as va hybrid loan.

Source: http://finance.redbright.co.za/the-lovely-truth-of-adjustable-va-loan-rates/

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