VA Mortgage Law and Legal Definition
VA mortgage is a veteran's mortgage that is guaranteed by the Veterans Administration. The Veterans Administration mortgage loan program was created in 1944 as part of what became known as the GI Bill of Rights. The goal of the program was to help returning war veterans become home owners. Some of the benefits of VA loans are no prepayment penalties; Insured against default by the United States government and Lower closing costs.
Another benefit of a VA loan is the ability to apply for an interest-rate reduction loan. Offered by the VA as part of the Streamline Refinancing Program, this loan allows veterans to refinance to a lower rate with little or no out-of-pocket expenses. VA loans are not actually provided by the federal government; rather, the government insures loans provided by private lenders. VA-insured loans are open to active military personnel, veterans, reservists, members of the National Guard, and unmarried spouses of a qualifying member of the armed forces who died as a result of serving in the military.