Texas Real Estate Sales Agent ExamFinancingEasy
A buyer is interested in purchasing a home with a low down payment and is comparing different loan options. They have excellent credit and are a veteran. Which type of loan is specifically designed to offer 100% financing (no down payment) to qualified veterans?
- AConventional loan
- BVA loan
- CFHA loan
- DUSDA loan
Show answer & explanationAnswer & explanation
Correct answer: B. VA loan
VA loans are guaranteed by the U.S. Department of Veterans Affairs and are specifically designed for eligible veterans, service members, and their surviving spouses, often requiring no down payment.
Why the other options are wrong
- A. Conventional loans often require a higher down payment (e.g., 5-20%) unless private mortgage insurance is used.
- C. FHA loans require a minimum down payment, typically 3.5%.
- D. USDA loans are for rural properties and require specific income limits, not primarily for veterans.
VA Loan Features
A VA loan is a mortgage option guaranteed by the U.S. Department of Veterans Affairs, offering significant benefits to eligible veterans, including 100% financing.
- No down payment required for eligible borrowers
- No private mortgage insurance (PMI)
- Competitive interest rates
Memory trick: Veterans are Granted A Loan (VGAL) for their service.