The VA loan program was introduced after World War II. Its purpose was to offer veterans the opportunity to own their own homes. The VA doesn’t lend money or issue mortgages. Instead, it insures mortgages, protecting the lender against any loss if the borrower defaults. Because VA loans are guaranteed they’re often easier to get.

VA loans are a good deal for several reasons. First, down payments are not required for VA loans. So it’s a great option if you can’t make a large down payment, or if you’d prefer to make a smaller down payment and keep some of your money in the bank.

There’s also no PMI with a VA loan. PMI means “private mortgage insurance.” If you pay less than 20% down on a conventional home loan, you’ll have to pay PMI until you have at least 20% equity in your house. Because VA loans don’t require 20% down, PMI isn’t an issue.

Additionally, VA loans offer competitive interest rates. This is probably the greatest benefit. Many lenders offer low- or no-down payment loans, but the interest rates are much higher. That VA loans can be gotten with little or no money down and at a competitive interest rate makes them a great deal!

Check eligibility requirements before pursuing a VA loan, as they are specific. If you are eligible, you’ll need a Certificate of Eligibility. Detailed eligibility information and certificate forms can be found at the U.S. Dept. of Veteran Affairs website.

Libor ARMs are only a good deal if the savings on the front end outweighs the risks of increased rates and payments later on.

Libor stands for “London InterBank Offer Rate”, and is the interest rate offered on banks in London which have large deposits of US money. The rates are fixed for a set time-period; typically 1 month, 3 months, 6 months, and 12 months. After that, rates are adjusted based on the current value of the Libor, plus a pre-determined margin.

For example, suppose you have a 3-month Libor ARM with an introductory rate of 3.15%, and a margin of 1.5%. At the end of the first three months, your new rate will be 1.5% plus the current rate of the 3-month Libor. So if the current rate is 3%, then your new rate is 4.5%.

If you’re considering a Libor ARM, find one that has an adjustment cap. Using the above example, if you have a rate cap of 1%, then your new rate is only 4.15%.

We recommend that you compare the features of a Libor to other ARMs before making a final decision. You need to do a careful comparison of rates, margins, and adjustment caps, in addition to other features. And, as always, we recommend that you talk with a reputable mortgage broker.

The United States is currently undergoing a nationwide foreclosure epidemic. There are more families losing their homes now than at any time in our history. Unfortunately, there are also more people looking capitalize on the misfortune of others as well.

You see them quite often, the little roadside signs stating that by calling a certain phone number, you can save your home from foreclosure. For some homeowners in trouble, this brief glimmer of hope is often all they have to hold on to. But the purveyors of this “helpful” service are often scammers looking to benefit from your hardship. Here are a few popular scams that homeowners in foreclosure often become victim of.

• When you call the phone number on the sign, the person on the other end will set up a meeting with you. This person will offer to buy your deed from you for a few thousand dollars. Once you sign the deed over to him, he will allow your home to go to sheriff’s sale.If you had a lot of equity in your home, often, the sale price will be higher than the amount owed on the original loan. If this happens, the owner of the deed gets the surplus money (the money left over after all the back payments and taxes are made). The crook walks away with all of the equity you’ve built into your home and you get nothing.
• In another variation of the “surplus money scam,” the scammer will tell you about the surplus money up front. Then, he will tell you how you cannot file a claim on your own and how particular the application and process is. The scammer will offer to do all the paperwork for you for a fee. In most cases, the “fee” ends up being 75 percent or more of the surplus money!

If you are in dire straights and you’re looking for a way out of your financial crisis, here are a few questions to ask yourself before accepting the help of an individual or agency.

• Is the individual or agency asking for payment up front?
• Is the individual or agency trying to rush you into signing something that you don’t fully understand?
• Does the solution sound too good to be true?
• Does the individual seem a little too happy to be helping you out?
• Is the individual or agency standoffish about answering your questions?

A “yes” answer to any of these questions should cause you to second guess using their services. While not all foreclosure services are scams, there are quite a few of them out there preying on the public. Your best bet to avoid becoming a victim is to get all of the services in writing, have all of your questions and concerns answered thoroughly and avoid any companies offering “virtually guaranteed” services.

Avoiding foreclosure scams, especially in today’s real estate crisis, is getting harder and harder to do. Use your common sense and look for the warning signs and hopefully, you can avoid this tough time in your life from becoming even tougher.