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Most of the federal government's loans are provided for the purchase of housing and property and are broadly segregated under the Veteran's Administration (VA) program and Federal Housing Administration (FHA) programs.
VA loans are for the benefit of veteran citizens and do not require large down payments. Federal Housing Administration loans programs have been devised to keep the first time home or property buyers in mind and have a low interest rate and down payment requirement compared to loans offered by private agencies. There are set parameters of eligibility for the FHA programs.
Government loans have a definitive edge over other loans because unlike loans provided by private financial institutions like banks, the government loans do not aim to make profits, but are instead aimed at helping legal citizens. The benefit of taking a government loan is that it has an added advantage of a complete waiver in case a person is not able to repay because of unforseen events like natural calamities.
The rate of interest for government loans is lower and a longer payback period is offered. There is also the option of refinancing various types of loans, for people who have been prompt at paying previous loans and have built up a good credit history.
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Government Loans