Obtaining a VA mortgage is a wonderfully cost-effective way to finance your house purchase in Eugene. Still, some fees go with this type of financing. Keep reading to find out about the VA funding fee and other costs you’ll need to cover before you can move into your dream home.
Benefits of a VA Home Loan
Financing a home through a VA loan comes with plenty of perks. Indeed, the benefits might make the difference between affording to purchase and having to continue to rent. Here are a few of the terrific benefits of opting for a VA mortgage.
- Flexible debt-to-income ratio requirements
- No down payment
- Lower credit score
- No private mortgage insurance
In short, you’ll find that buying a home with a VA loan is a straightforward way to loan approval. Compared to conventional home loans, you’ll likely pay less money upfront. Nonetheless, there are fees attached to loans guaranteed by the Veterans Administration.
Are you ready to see how a VA guaranteed home loan can help you buy a house? If so, you’ll need to obtain a Certificate of Eligibility from the U.S. Department of Veterans Affairs. Once you receive approval, it’s time to meet with lenders to discuss using a VA loan to buy your Eugene dream home.
VA Funding Fee
The VA funding fee is a non-negotiable, one-time cost attached to this kind of financing. You can pay the fee when you close on the house or over the life of the loan.
Unlike some other lending fees, the amount of money you’ll need for the VA funding fee varies. Specifically, the cost is a percentage of the total purchase price based on factors, such as whether it’s your first VA home loan and how much money you put into a down payment.
Read here for information on how to estimate how much your VA funding fee will be when you buy your house.
Additional Loan Fees
You’ll always pay a VA funding fee, regardless of the lender. However, there are other fees that you might receive depending on the bank. Since the lending fees can vary according to your lender, you must look at the loan packages offered by several lenders to compare the total costs of the mortgage.
Some of the typical fees you’ll need to pay when you close your VA home loan include the following:
- Appraisal Fee
- Origination Fee
- Title Insurance
- Home Inspections
- Property Taxes and Insurance
- Recording Fee
- Homeowner Association Fee
- Real Estate Commissions
The amount you’ll pay for fees will vary according to your lender and where you live. Don’t worry about facing any surprises at closing related to the total cost of the loan fees. Your lender and real estate agent will keep you informed throughout the loan process.
Budget for Your House Hunt
While you think about the costs related to taking out a home loan, take time to consider your overall housing budget. There’s no getting around that Eugene is an excellent place to live, and houses in our community can be pricey. Even so, your future sanity depends on you not buying a home that you can’t afford right now.
Take a look at your money situation. Experts recommend that you aim to spend no more than thirty percent of your income on housing costs. Keeping your monthly housing costs on the low side helps to cushion the financial hit when you face unexpected housing repairs.
Home upkeep is a necessary part of homeownership. Strive to bank at least one percent of the total value of your home each year, so you aren’t overwhelmed by the cost of repairs.
Be honest with your real estate agent about your budget. House hunting is much more fun when you look at houses that you can afford to buy. Indeed, there’s nothing more gratifying than walking into a terrific place and knowing that your hard work and commitment put it well within your means to call it home.
Last Thoughts
Lastly, understanding things like a VA funding fee before you begin to shop for a loan helps you obtain the most favorable mortgage. With a commitment to your budget and some planning, a VA home mortgage is a terrific way to finance a home in Eugene.
The home loan officers at Strategic Mortgage Solutions know how to connect our clients with outstanding home loans. Contact us, and we’ll show you how you can comfortably afford your ideal house.
