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Military home buyers have a number of home buying benefits at their disposal. They know what neighborhoods are growing in popularity and value, and they know which areas are best to avoid. Nobody understands the local housing market quite like them, making them valuable if you’re moving from a different city or state. Your lender is required by law to provide you a Closing Disclosure at least three business days before closing. The lender will review the appraisal when it is complete to ensure it meets their underwriting standards, and there is sufficient collateral to complete the home loan. If you are using the VA-guaranteed Home Loan benefit, a VA approved appraiser will complete the appraisal to determine the home’s value and ensure it is safe, sound, and sanitary for you and your family.
The reason for this is because the VA will guarantee the loan amount for EITHER the sales price OR the appraised value, whichever is lowest. The VA Certificate of Eligibility can be delivered to the lender electronically, and you can also request one by mail. In certain cases, a VA COE may ONLY be available through the mail, as in the cases of qualifying surviving spouses who request one. The first step toward getting a VA mortgage is establishing whether you are currently eligible or not and passing that information to a lender. To locate VA mortgage listings for assumable VA mortgages, you should check out several websites, such as TakeList. The websites provide you with all the information you need, such as the balance amount, interest rate, and the seller’s exchange expectations.
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To limit your closing expenses, ask your real estate agent to submit your offer with the seller paying your closing costs. Remember, you’ll go through a private bank, mortgage company, or credit union—not through us—to get your loan. Lenders offer different loan interest rates and fees, so shop around for the loan that best meets your needs. Combining a Veteran friendly real estate agent with VA loan officer can be a very powerful combination. Frankly, in today’s competitive market, this unique teamwork may be your only recipe for successfully negotiating the purchase of your ideal home using your VA loan.
Therefore, their focus is on preventing VA-loan borrowers from purchasing homes that may have major defects in their construction, craftsmanship, plumbing, ventilation, etc. When you work with any client, it’s essential that you go into each pitch or interview feeling prepared. Therefore, you may be wondering if working with VA-loan clients is any different than working with clients who obtain convention loans. However, a VA borrower can lower their funding fee by making a down payment. A down payment of 5% reduces the fee to 1.65%, while a down payment of 10% reduces it to 1.4%. These professionals can help you get the most from your homebuying budget and your wish list.
The Home Buying Process For Veterans
Veterans Affairs loans were introduced in 1944 as part of the GI Bill of Rights Act to ease the transition from a life in uniform to civilian life. The advantages of using these are many and include no down payment requirements and lower interest rates. If there were only upsides to using a real estate agent with a VA loan, then every home buyer would use them.
Up until recently, the VA did not allow its borrowers to pay the majority of closing costs. Although the lack of fees was intended to be another benefit to VA borrowers, the guideline made it more challenging for them to find willing sellers. The VA loan is a specialized program, and military borrowers often have unique needs. It’s important to try and find a real estate agent who understands both.
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Additionally, a loan officer who handles VA loans day in and day out may be more experienced in managing special cases that can sometimes delay the VA loan process elsewhere. Veterans who are eligible for VA home loan benefits and in the market for a new house can utilize lenders and real estate professionals to their advantage. When you assume a mortgage loan, it is essentially the same as a sale-purchase agreement. The seller transfers the terms, interest rates, and mortgage balance remaining from the previous owner to the buyer. When buyers assume the previous owner’s mortgage, they won’t have to take out a new loan to pay for the property. Veterans United's mission is to help Veterans and service members take advantage of the home loan benefits earned by their service.
“A buyer needs to set a budget and have an understanding of what the sales price means for a monthly payment,” says Viola. Before you decide to work with an agent, it’s important to be familiar with buyer’s agreements. Many real estate agents will expect you to sign a buyer-broker agreement before they agree to represent you.
Find a VA-Experienced Agent
Before your client can obtain a VA loan, their lender will need a copy of their Certificate of Eligibility, which is a document provided by the VA as proof of their qualification. While the lender can obtain this form independently through the VA’s automated system, your client will need to provide the lender with proof of service. Your client may also qualify if your client is a surviving spouse of a service member, who lost their life either in the line of duty or due to a service-related disability. After all, financing is one of the most complicated parts of the business. While you may know enough about conventional loans to help the majority of your clients, you may not be as confident about your understanding of the VA Home Loan process. A VA approved lender; Not endorsed or sponsored by the Dept. of Veterans Affairs or any government agency.
“Sellers have a few old misconceptions about VA loans that they are burdensome, take longer to close, have more requirements, etc. but for lenders, VA loans are one of the easier loan types,” says Viola. Of course, it’s not always the items on the appraisal that create a problem. Sometimes it’s the estimated home value itself that may lead to second thoughts or financing hiccups. Again, your client will have options if the appraisal comes back lower than expected.
Be prepared to sign a lot of documents—and be sure to take the time to read everything before you sign. Buying a home is a complex process, and getting a VA-backed loan is only one piece of the puzzle. Before sharing sensitive information, make sure you're on a federal government site.
Since VA loans are backed by the federal government, they are viewed by lenders as involving less risk. As a result, lenders are able to offer veterans interest rates that are typically .5% – 1% lower than rates offered for conventional loans. VA loans can only be used to finance one- to four-unit residential properties that the veteran intends to occupy. However, for real estate agents who have never worked with VA clients before, the process can seem a bit daunting.
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