Lower mortgage rates are just one part of the equation when assessing the benefits of a VA home loan.  In fact, when you break it down in more detail, you’ll find rate, in and of itself, may not even be the most significant factor when getting this type of mortgage.

Some Number Crunching:
Getting a lower rate is always great and many people put off locking in a mortgage because they’re “watching the rate.” Well, you may want to re-think that strategy a bit as rate doesn’t always mean that much when you crunch the numbers. An eighth of a percentage point, on a 30-year loan, with a principle of $100,000 results in a difference of approximately $7 dollars a month. That’s the equivalent of a cup of coffee — every other week — from your local café. A little more than $80 a year may not be a significant factor when deciding on taking advantage of your VA Home Loan benefits, especially when you consider these other mitigating points:

Cash-out Refinancing
VA loan benefits go much deeper than just rate. There’s the option to take cash out, up to 100% of the equity in your home. These funds can be used to reduce high-interest debts, such as credit cards, or car loans.

Tax Implications
Home mortgage interest is also tax deductible, while other high-interest debts are not, resulting in significant savings at year’s end.

Term Reduction
For those who are able, term reduction can also occur. You can turn your 30-year mortgage into 20 or even 15 years, without a significant hit to your pocket.

Payment Deferral
The post-closing period, usually less than 30 days, will also result in a deferral of your first month’s payment. Who couldn’t use a month, mortgage-free?

Bottom line here: don’t focus solely on rate when deciding to take advantage of your VA home loan Benefit there are several other cost saving advantages that you could benefit from. If you have any questions or would like to speak to a VA Loan Specialist, call us today at 1-844-MDM-4YOU or email us at: info@militarydirectmortgage and we’ll help you see the bigger picture when it comes to a VA home loan.