As a qualified veteran or current military service member, you’re eligible to buy a home with a VA loan in Colorado Springs. These loans offer more flexible repayment terms and typically have lower interest rates than conventional mortgages, making buying a new house more affordable.
Though the VA guarantees the VA loans issued by mortgage lenders, they can’t guarantee you a specific interest rate or loan percentage. You need to review the market conditions to better understand what you’re getting into. Here are a few key things to keep in mind.
VA Loan Rates Will Vary
Lenders can review your application for a VA loan in Colorado Springs to determine whether you’re going to be a responsible borrower. If your finances are stable and you have a good credit score, you’ll likely qualify for a better interest rate. The lower your rate is, the more affordable your loan will be over time.
That said, different lenders will view your application in different ways. Some may see you as an ideal borrower and offer you the lowest rate possible while others may see your financial situation as slightly risky.
Rates Will Still Be Lower
Though the VA doesn’t set interest rates, lenders that issue VA loans believe in rewarding you for your service to the country. This is why they offer lower-than-average interest rates on most VA loans. That interest may be as low as 2 percent for some qualified borrowers.
Keep in mind that it all comes down to the individual lender. The VA simply guarantees the loan. It’s up to the lender to set interest rates on the loan products they provide.
The APR Can Impact the Cost of Your Loan
Though the standard VA loan in Colorado Springs comes with a lower interest rate than what you’d find with a conventional mortgage, it’s not the only rate you need to worry about. You also need to consider the APR for each loan you’re applying for.
The APR calculates the closing costs, funding fee, and any other expenses associated with the loan into your total interest rate on the loan. The APR more accurately shows what you’ll pay the lender and the higher it is, the more money you’ll owe over the life of the loan.
Get Help Now
Figuring out which VA loan in Colorado Springs is right for your upcoming home purchase can feel like a bit of a mystery. Contact Mortgage Solutions Financial and let our team help.