Insurance

In earlier articles I discussed the benefits of home ownership using VA loans to veterans nationwide--low-to-no money down & lower closing costs are a few examples. These special loans for veterans can be obtained from a variety of mortgage brokers. With CalVet loans, on the other hand, you need to apply with the California government because it's a state sponsored program. Additionally, this program is not valid for re-financing veteran's current homes.

Because it is a veteran's benefit the state government will make every effort to make the loan available to all veterans. You will be qualified for the loan using the same criteria as other lenders, but because the state is a direct lender and they service the loans they make, they are able to give every veteran extra consideration, and if you qualify for a loan you get the same rate as everyone else. You will not be classified as a higher risk and have an increase in the interest rate.

The program is a bit different from a regular house purchase because CalVet uses a Contract of Sale, or Land Contract, as the financing instrument for the loan. What this means is that CalVet actually purchases the home you select and takes legal title and then sells the house to you using a contract of sale. When the loan is finally paid in full, after 30 years of payments or because you sell it and move or refinance, CalVet will issue you a grant deed to transfer legal title to you.

One advantage to this program is that CalVet gets groups rates on Fire & Hazard insurance as well as Disaster insurance, providing the veteran with superior coverage that would not be available as an individual.

The other advantage to a CalVet loan is through their Life & Disability coverage. With this mandatory life insurance your family will be protected for up to 5 years of principal and interest payments in the event of the insured's death.

Additionally, CalVet offers a Home Improvement Loan program as well that can be used to finance most improvements on your home.

Whether you as a California veteran choose a CalVet Loan or a VA Loan doesn't matter. Examine which program is best for you, your family and your situation. What does matter is that you take advantage of these powerful, money-saving tools available to you in order to partake of the American dream of home ownership.