Despite the worldwide havoc brought about by the COVID-19 pandemic, the applications for VA loans, El Paso, TX, continue to climb. In 2020 alone, the US tallied 1.2 million VA-backed loan originations – a whopping 11.4% increase from 2019.
There are several reasons why the applications for VA loans, El Paso, TX, continue to soar, including the following:
Reason #1: Blue Water Navy Vietnam Veterans Act of 2019
This new legislation went into effect on January 1, 2020, and has been considered one of the primary drivers why VA loans became more appealing in 2020. And why not? The law crosses out loan limits for most borrowers. Unlike before, VA borrowers who exceed maximum loan amounts do not need to make a down payment to bridge the gap.
Reason #2: Younger Applicants Surge
According to a recent report by Veterans United, 50% of all VA loans used to buy a house in 2020 were from millennials and Gen Z. There are two primary reasons for this trend:
1. Younger veterans can take advantage of their eligibility for some form of educational benefit – either through the G.I. Bill scholarship or other tuition assistance program, which are not available to their civilian counterparts;
2. They do not have to allocate years building top-tier credit or saving up for a down payment like non-veterans first-time buyers do.
Reason #3: A Surge In VA Refinancing
The continued drop in mortgage rates fueled the surge of VA refinancing applications in 2020. Homeowners took advantage of the significant decline in mortgage rates to swap their current rates with lower ones. That was the reason why VA refinance loans shoot up past the 2019 numbers, growing 241% year-over-year.
With this VA loan trend continues to trudge toward the trajectory favorable to borrowers, the industry expects that VA loan applications will continue to climb in several years to come.
Online looking for a reputable company that offers VA loans, El Paso, TX? Talk to an expert at Homeplus Mortgage today.
Call us at (512) 949-3385.
