Government-backed programs typically offer lower interest rates, low down payment options and competitive closing costs. But you can get a reasonable loan by comparing multiple lenders against your range of home prices and long-term financial goals.
Government-backed financing in Virginia
Take your time comparing rates, closing costs and down payment options and see if you qualify for a government-backed home loan program. If you’re buying in a rural or suburban area or are a first-time homebuyer, you might find stronger loan terms through FHA or USDA programs.
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Mortgage lenders for veterans in Virginia
The Veteran Affairs (VA) home loan program offers mortgages that allow for low down payment options, low interest rates and no mortgage insurance. VA mortgages are available from the VA itself or through private lenders, and they’re open to veterans, active service members and select military spouses.
How to compare the best lenders and rates in Virginia
When narrowing your options, look beyond interest rates to compare fees, terms and the type of loan that fits your needs:
- Interest rates. Compare advertised low rates against the terms and any perks of the loan.
- Fees. Ask about application, maintenance, insurance, prepayment and any other fees you might end up paying.
- Terms. A 15-year mortgage can significantly shave down interest, but with higher payments, while a 30-year offers the stability of lower payments.
- Type. Adjustable rates tend to start out low but can make it hard to predict how much you’ll pay in the future. Fixed-rates, on the other hand, are predictable and can help your budget stay on track.
- Discounts. Loan programs through the VA, USDA and Virginia Housing Development Authority can help eligible homeowners cut overall costs.
How the Virginia Housing Development Authority can help
First-time homebuyers may benefit from this state-backed agency offering:
- Variety of home loans. Conventional, FHA, VA and Rural Housing Services loans come with fixed rates over 30 years.
- Down payment support. The VHDA Plus Second Mortgage and Down Payment Assistance Grant offers support with down payments to eligible homebuyers.
- Closing cost assistance. Those in Virginia’s rural markets and eligible veterans may get help with closing costs through a grant.
- Mortgage credit certificates. You may be able to claim a federal tax credit for a portion of mortgage interest you pay during a year.
Closing cost fees in Virginia
After taxes, you could pay an average $5,849 in closing fees on mortgage between $200,000 and $300,000. High costs are in part a result of the high taxes in this state, which can make up close to 50% of the closing cost fees. Compared to its neighbors, only Maryland has higher closing costs than Virginia.
Government-backed and local programs from the VHDA could get you strong loan terms. But look for competitive options from banks, credit unions and other lenders as well.
Compare a range of mortgage lenders to find the right fit for your long-term financing needs.
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