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PenFed Top 10, VA Loans, Purchase, Closing on a Loan

Top 10 Reasons to Consider a VA Loan from a Credit Union

What You'll Learn: Credit Unions Catering to Vets Offer Lower Interest and Fewer Fees


Do credit unions do VA loans? Yes, some offer VA loans, but not all. And hands down, some of the best mortgage lenders for veterans are credit unions that specialize in VA loans. Just like veterans and service members, credit unions are focused on serving others.

And many credit unions catering to vets offer lower interest and fewer fees than mortgage brokers and banks. Let’s explore why a veteran or service member might choose to  purchase a VA loan or IRRRL from a credit union.

#1 Non-Profit VA Loan Lenders

Credit unions are “non-profit”, with members being part owners. If the credit union makes a profit, it can be reinvested to support its members. Profits help keep rates and fees low.

The purpose of banks and mortgage brokers is to make money, that’s why they’re “for-profit”. Their profits go back to the shareholders. Therefore, the banks’ fees and interest rates may be higher than credit unions.

#2 Service-Oriented

With so much automation, sometimes customers feel more like a bother than a  valuable asset. Many credit unions tend to be more customer-oriented with the small-town touch, even if they have millions of members.

Along with the personal service, credit unions also offer technology that makes banking easier and more convenient. Many of the larger credit unions are open 24/7. That’s especially helpful if they’re serving veterans all over the world.

#3 A Strong Purpose to Support Veterans

Credit unions typically are formed to support a specific group. Some credit unions were founded to help service members and veterans. Along with supporting veterans, members may find many other things and causes in common, such as patriotic American values and a strong work ethic. 

#4 Lower Rates for Credit Union VA Loans

When it comes to getting a home loan, credit unions may offer some of the lowest VA interest rates. Rather than sending any profits to shareholders, or increased pay for top executives, a credit union may reinvest their earnings into their members in the form of lower interest rates and fees.

Even a .25% lower interest can save you thousands over the life of the loan. So, when you’re shopping, it’s always wise to compare credit union VA mortgage rates to banks.

And if you’re looking for the best IRRRL rates — start at credit unions that support veterans. VA IRRRL lenders offering the lowest rates often have the most experience too.

#5 Lower Lender Fees

When you’re looking at VA mortgage interest rates, make sure to check out the lender closing costs such as origination, underwriting, and credit report fees. Keep in mind that many closing costs charged in a loan are from third parties and are not controlled by the lender. These include title and escrow fees, homeowners insurance, and property taxes. So, make comparing lenders easy and only compare their fees and the interest rates.

Buydown fees are another good thing to compare. If you want a lower rate, how much does it cost you? There can be a difference between lenders.

#6 Member Discounts

Credit unions also offer member discounts for other services a veteran might need. So, in addition to receiving low mortgage rates and fees, members can also save on other services like homeowner’s insurance, car buying services, auto insurance, car rental discounts, and more.

Being part of a credit union can give you lower interest rates on VA purchase loans and refinances plus advantages mortgage bankers and brokers can’t offer.

#7 Financial Education

Besides offering VA home loans and other mortgage and financial services, many credit unions provide financial education for their members. That’s because since credit unions are non-profit and the members are part owners when a member is financially successful — so is the credit union.

Credit unions tend to educate their members on how to build good credit, the best ways to save money, the smartest ways to finance college, how to save for retirement, and more.

#8 Multi-Product Convenience

Credit unions offer a vast array of products, including VA home loans, conventional loans, FHA loans, and jumbo loans. Plus, members can get their other financial services at the same place for ease and convenience.

Members appreciate that they can log in online and see their checking, savings, credit cards, auto loans, and mortgages all in one place. That makes bill paying and transferring money a breeze.

#9 Supports Local Charities

Veterans more than almost any other group need and deserve assistance. If you’re looking to join a credit union — see what charities, they support.

In addition to making smart personal financial choices, it’s rewarding to align yourself with a group that helps veterans.

#10 Experienced in Closing VA Loans

Whether you’re getting a VA loan to purchase a home or an IRRRL to refinance, having a lender experienced with VA loans is vital. Credit unions that primarily offer VA loans may process thousands of mortgages every year. As a borrower, this should give you more confidence that the loan process will be smooth and stress-free.

Experienced IRRRL lenders know what documentation is needed and how to deal with complicated issues like restoring a VA loan. Credit unions can offer the help, support, and mortgage financing veterans need and appreciate.

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VA Disclosures

1Rates are updated daily at 10:15am EST. The advertised rates and points are subject to change. The information provided is based on discount point, which equals percent of the loan amount, and assumes the purpose of the loan is to purchase a property with a 30-year, conforming, fixed-rate loan. Loan amount of $450,000; loan-to-value ratio of 95%; credit score of 760; and DTI of 18% or less. The property is an existing single-family home and will be used as a primary residence. The advertised rates are based on certain assumptions and loan scenarios, and the rate you may receive will depend on your individual circumstances, including your credit history, loan amount, down payment, and our internal credit criteria. Other rates, points, and terms may be available. All loans are subject to credit and property approval.