If you’re wondering what PMI is and if you need to pay for it when applying for a VA home loan, we have your back. Private Mortgage Insurance is typically required when applying for some conventional loans to protect lenders in the event that a borrower is unable to repay their mortgage.
But for those who’ve served our country, VA loans offer several more advantages than conventional mortgages and not paying for a PMI is one of them.
Why is PMI not required for VA loans?
Before you apply for any type of mortgage loan, you should be as informed as possible about VA loans and PMI.
PMI insurance is not typically required for VA loans. As explained above, private mortgage insurance is often paid monthly to alleviate risk to the lender. This is not the case with VA loans, however, because they are guaranteed by the Department of Veterans Affairs (VA) instead.
VA loans are specially designed to help military veterans on an easy path to homeownership. Before you apply for a VA loan, you’ll want to verify your eligibility by accessing your Certificate of Eligibility from the VA.
What are the requirements of a VA loan?
To qualify for a VA home loan, you will need to be currently in service, or honorably discharged and meet one of the following requirements:
- You have served active duty for at least 90 consecutive days in wartime, or 181 days during peacetime.
- You have served for more than six years in the National Guard, or the Selective Reserve.
- You are a qualified surviving spouse or partner of one of the above.
For more detailed information about VA eligibility, please visit the VA website.
VA lenders will set other requirements, as they do with conventional mortgages. You must demonstrate you have adequate income to repay the loan, and you must have a reasonable debt burden. It will always be helpful to have a good credit score, but it’s not necessary to have good credit to access a VA loan.
For additional information on home loans for veterans, you can access our learning center. The Federal Savings Bank is a veteran-owned bank that specializes in helping veterans obtain VA mortgages. To apply for a VA home loan or more information, you can contact our team of VA mortgage specialists at +1 877-788-3520. You’ll be in your dream home before you know it.
Subject to credit approval. Terms and conditions may apply. Property insurance is required for all loans secured by property.