Loans for Military Retirees

When people decide to serve their country, it is a supreme act of patriotism, and some of them are called upon to give that last full measure of devotion. Yet, fortunately, many live to retire from their branch of the armed forces. And, it is then that getting loans for military retirees becomes important to them.

Finding what is Available

One of the best types of loans for military retirees is to go through the Department of Veterans Affairs, and use something like the VA Home Loan Program. The program has some great features to it. First off, veterans can get as much as $417,000 to put toward the home they want to buy. Second, this type of mortgage does not require any sort of down payment.

Next, and this is an important one, a VA loan is a fixed-rate mortgage, and the rate is very low. When you consider how the subprime mortgage market has suffered a total meltdown recently, anything that helps military retirees is a good program. Also, the program allows them to refinance a mortgage and get a lower monthly payment.

Again, in the event a retiree has gotten a subprime mortgage, refinancing to a VA loan can be a lifesaver. And finally, the money from a VA loan can be used for other things. Many retired military personnel need cash for their families, to pay for college, or to consolidate bills.

Considerations

When looking at loans for military retirees, there are some things to consider. First off, it is

Well, sometimes that means being saddled with a monthly payment that is far beyond their means. So, knowing beforehand what they can afford is the best way to go. Next, the retiree should check their credit rating. Lenders like the VA have underwriters who will be looking at the borrower’s credit report.

And, here is a little side note, a large number of credit reports have mistakes in them! The lenders use a very complex formula to calculate how much they are willing to let a person borrow; so making sure their credit report is as accurate as possible is important. When looking at loans for military retirees, there is also the issue of the interest rate.

The VA will line up three different loans for all military applicants, and the borrower can take their pick of a fixed-rate mortgage or an adjustable rate mortgage. Of course, what with the subprime debacle, most people are rather “gun shy” about the idea of getting an adjustable rate mortgage, and can you blame them? Yet, with the VA program, the adjustable rate is not all that bad.

The interest rate can not increase more than one percent each year, and no more than five percent over the life of the loan. So, military retirees should not discount any loan without first looking at all the options.