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Clients Thinking of VA Financing? Keep a Couple Things in Mind

I attended another seminar this week (you can’t have too much information.) Anyway, there are definite advantages for VA loans as we already knew - VA & Cal-Vet loans offer lower than market interest rates, a low or no down payment and expanded eligibility – but there are a couple things to keep in mind.

>> Our office received an offer on a short sale. Not a bad offer but they had stipulated VA financing. The home was in need of some repair work. Here’s the first reminder…

All repair work has to be completed before the loan is closed.

>> This particular point was repeated several times so evidently this one is important…

The lender arranges the appraisal and should be the only contact for the appraiser. The horror stories used to illustrate this point indicated that evidently VA appraisers are very touchy & very easily offended – some would say p****d off.

>> In the past the interest rate was decided by the VA BUT now the interest rate for these loans are set by the lender.

>> If someone is due to be discharged within the next 12 months they need proof of an income after separation such as a letter certifying a gauranteed position from an employer or something showing commencement of retirement benefits.

Some especially good news was that VA loans can usually be closed within 30 days. Everything can now be handled through a computerized system (email, etc.). Even getting vital documentation like a Certificate of Eligibility usually takes only minutes as compared to days or weeks in the past.

**There are definitely more than a couple of financing options out there to help everyone become homeowners.**

Posted by Lynnette Phillips Real Estate Consultant on 05/23/2008 01:03 PM

Comments (6)

va financing, va loans

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6 Comments on Clients Thinking of VA Financing? Keep a Couple Things in Mind

Thanks for the information, Lynette. I am encouraged to apply for a VA loan for myself, although it looks like income might be touch and go for a Realtor.
JimG

05/23/2008 01:16 PM

by Cape Coral Florida Golf Course and Waterfront Homes (Sellstate Advantage Realty)

You know, I appreciate VA loans and will work hard for them... HOWEVER, they have always been difficult to work with in certain markets. The rules are too strict, the appraisers who determine what "work" should be done do more harm in most cases.

05/23/2008 01:17 PM

by Patrick Lambert (Century 21 All Islands)

05/23/2008 01:17 PM

by Patrick Lambert (Century 21 All Islands)

Jim, We've had to find ways to supplement our income in our office...that is the few that have chosen to stay in the industry.

Good Luck!

Patrick, In this seminar they tried to impress upon us that things were more lenient than in the past. Also that the lender could be a great help if they chose to be. We were also told switching over to an FHA loan could sometimes be the way to go - often FHA provides the same or very similar interest rate and can be very flexible, the only problem may be the FICO requirement...it does depend upon the individual situation, though.

Don't let anyone scare you away from this great option...try this link for uncertainities or questions http://www.homeloans.va.gov

Have a great Memorial Day weekend!

05/23/2008 01:51 PM

by Lynnette Phillips Real Estate Consultant (Home Pride Mortgage)

Thanks for the post. With all the problems we have in closing a short sale I wonder how an offer on a house requiring repairs ( for VA loan ) would be accepted. But our job is to present the offer and explain other types of mortgages.

05/27/2008 06:54 AM

by GITA BANTWAL, REALTOR BUCKS COUNTY, PA HOMES (ReMax Centre Realtors)

Gita, I just realized I hadn't responded to your post...I'm so sorry!

VA inspectors are so particular (as they should be) a home needing repairs often won't go through but sometimes the problem can be handled by switching to FHA financing.

I don't know about your market but in CA short sales often need to be accompanied by therapy for the agent :)

06/03/2008 12:26 PM

by Lynnette Phillips Real Estate Consultant (Home Pride Mortgage)

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