Which of the following is a key benefit of a VA loan for eligible veterans?
Correct Answer
A) No down payment is required
One of the most significant benefits of a VA loan is that eligible veterans, active-duty service members, and surviving spouses can purchase a home with no down payment required. VA loans also do not require private mortgage insurance (PMI), though a VA funding fee is typically charged. Both A and B are genuine VA benefits, but the no-down-payment feature is the most widely recognized primary benefit tested on real estate exams.
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Related Topics & Key Terms
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Related Concepts
Usury is the practice of charging an interest rate that exceeds the maximum rate permitted by state law. Usury laws protect borrowers from excessive interest charges on loans.
A VA loan is a mortgage guaranteed by the Department of Veterans Affairs available to eligible veterans, active-duty service members, and surviving spouses. It offers no down payment and no private mortgage insurance requirements.
An adjustable-rate mortgage (ARM) has an interest rate that changes periodically based on market conditions, typically after an initial fixed-rate period. The rate adjustment is tied to a financial index plus a margin.
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