I thought I would jot down some important facts about the VA loan that would be useful information to the realtor. VA Loans are awesome ways to finance homes for Veterans who are eligible for the product. It is really rewarding to help someone who helped protect and defend America realize the American dream of owning a piece of America.
There are some that shy away from these type of loans but with what our country has been through in the last 2 years assisting Veterans will be more and more common.
Some quick helps-
VA Loans require no down payment - it is 100% financing it enables someone to get in a home with nothing down and is backed by the VA guaranty - this allows the veteran to keep his savings which can be help out especially if this is a family transitioning from military life to civilian life.
There is no mortgage insurance when it comes to a VA Loan - so typically on average the veteran does not have to pay the 50 to 60 dollars per month premium that you would typically have on an FHA loan.
Not all veterans are eligible - most of the time when a veteran is discharged they are told about their benefits - some automatically assume they are that may not be the case, the lender can determine by obtaining their discharge papers or form dd214.
Have a property that needs some updates to make it more energy efficient? The VA Loan allows for financing of those updates on top of the purchase price - there are special guide lines depending on the cost of the repairs to be made- whether it be 1- 3000 dollars or 3000 to 6000 dollars, recently I helped a veteran who was able to include a brand new furnace, the energy efficiency was going to net 48 a month while the financing was only going to raise his payment 29 per month.
Disabled Veterans - Do not pay the VA funding fee - its waved for them.
Sellers can pay closing costs on a VA loan -
There are special grants from the VA to retro fit a home that requires an update that would accomodate a disability - these grants are something the government does for the veteran and these grants do NOT have to pay the loan back.
There is NO prepayment penalty with a VA Loan-
The VA hires the appraiser for the VA loan - the lending institution does not -
The amount of the VA funding fee (which is financed) depends on the number of times the Veteran has used the benefit.
A veteran can utilize his benefit again but can only have one VA loan at a time.
VA Loans are great to refinance should the market decrease many times they qualify to do a VA Interest rate reduction refinance which consists of an application - and credit check, no income qualification to refinance and no appraisal required to refinance.
These are some of the benefits to keep in mind - when looking at homes- I would want to know for instance if I had a client that loved a house but was disabled and the bathrooms were to small that a grant may be availalbe that would allow me to buy the house and upgrade it at no cost to me.
Many of these key items I hope will assist you at winning the business from these brave men and women in uniform.
Darren Stewart
Home Lending Team