Sometimes you may have to sell a property before you intended on doing so. A VA loan is a special loan that is given to military veterans so that they can purchase a home without a down payment. This loan gives very good interest rates to veterans, allows them to avoid private mortgage insurance, and has fairly low requirements. However, because of the unique requirements of a VA loan, there are two options that a veteran might have.
Selling a Home Conventionally
Selling a home with a conventional mortgage will buy out your VA loan. The buyer will have to get a mortgage for the full purchase amount or purchase the home in cash. However, they will also need to purchase the home for more than you owe. If you just purchased your home not too long ago, this could be a problem; you could conceivably owe more than the fair market value, especially when you consider the costs of your real estate agent's fees. This is especially common because VA loans are $0 down loans. It is possible to purchase a house for $200,000 that is only worth $195,000. The additional cost of the sale (closing costs) will be approximately 5% to 6% of this, potentially costing you money in order to sell your house.
Having a Purchaser Assume the Loan
For VA loans, there is another alternative. It is possible for the individual in question to acquire the cost of your loan. Your loan will not change. Instead, legal documents will be drawn up that allow the purchaser to take over your payments in exchange for the equity of the home. If you have not put many payments into your home yet -- and selling conventionally isn't an option -- this is a very easy way to get out of the loan without having to pay any money. However, there is a downside as well: your VA entitlement will not be restored. That means you will not be able to get another VA home loan.
Renting out a home acquired through a VA loan is generally not an option unless you have been living in the home for quite some time. This is because VA loans are only intended for use on primary residences. There may be some exceptions to this if you are going through the process of relocation due to a military relocation. For other questions, the veteran's assistance programs should be able to help. For more information, check out websites like http://www.bestclarksvillehomes4u.com.