Veterans Administration Loan Guaranty Program (VA)
Definition of "Veterans Administration Loan Guaranty Program (VA)"
Loan guaranty program included in the Servicemen's Readjustment Act of 1944. Its provisions cover the compensation to lenders for losses they might sustain in providing financing to approved veterans. The maximum guaranteed amount which has periodically been increased, is set by the VA as is the maximum interest rate charged by lenders. There are no provisions on the upper limits of the loan-to-value ratio, which means that it is quite common for an approved veteran to receive 100% VA financing. It should be noted that some lenders set limits on how much they will finance using VA financing. The VA guarantees loans up to 30 years. A VA loan is assumable, however, unless released by the lender, the veteran who borrowed the funds initially remains liable to the lender. Lenders cannot insert prepayment penalties under either VA or FHA loans. A mortgage without a prepayment penalty is commonly referred to as an open mortgage, while one that cannot be prepaid is a closed mortgage. The VA limits the points charged to the buyer to one. Any other points must be paid by the seller.
Popular Real Estate Terms
Federal agency that monitors the federal savings an loan associations and federally insured state-charted S&Ls. It acts as a central bank. ...
Room in a home where the occupants spend their leisure time. ...
Where property is sold to the highest bidder. ...
Sometimes, a perplexing legal term (a genuine headscratcher) emerges when buying or selling a property. You know you should know it, but its precise definition escapes you. Today's special ...
In urban areas, one way to organize urban development is to keep track of building density. The building density definition is a way to determine the concentration of buildings in a given ...
Substituting one party for another in an action giving that party full rights or claims. Foe example, an insurance company pays the insured for a fire loss caused to the home by a third ...
A written agreement between institutional investors to buy or sell ownership shares in mortgages. An institution such as a bank can agree to buy a certain number of shares in a single or ...
As a hopeful house hunter, renter, or seasoned real estate investor, you've probably come across baffling terms. One such term is "adhesion contract." It might sound complex, but don't ...
Self-employed contractor who may perform work on a structure such as residential or commercial property. ...
Have a question or comment?
We're here to help.