7 surprising perks of VA loans

Why don't you have one of these mortgages?

Home loans guaranteed by the Department of Veteran Affairs have been growing in popularity over the past few years. Lenders made a record 629,300 VA loans during fiscal 2013.

And no wonder.

Banks and mortgage companies like them because the VA agrees to cover up to 25% of the loan amount if the borrower defaults.

Home buyers benefit because that protection allows lenders to make VA loans at competitive interest rates, with cheaper terms than conventional mortgages.

“The VA loan has spectacularly good terms — nothing else comes close,” says Joe Parsons, senior loan officer at PFS Funding, a Dublin, California, mortgage broker.

Yet only a small minority — less than 12% of the 16.4 million service members and veterans with a mortgage — take advantage of VA loans, according to the National Mortgage News.

Is it time for you to consider a VA loan? Here are the key advantages, or perks, they provide.

By Rachel Hartman
Interest.com Contributing Editor