VETS: Coming home to our economy in such a state --they deserve all the help we can offer! Considering so many veterans are re-entering the workforce at once, they may need help settling back into life at home. In many cases, their former jobs may no longer exist! Hopefully the VA centers are able to kick in with job training and transition assistance. Many vets may be asking if their homes or mortgages serve their current needs. I know members of the Active Rain community are on the lookout for ways to be of assistance. Having some basic information about VA loans could come in handy.
100% PURCHASE FINANCING Veterans, surviving spouses or active duty military persons can secure a VA loan at very attractive terms. Not all banks can fund VA Loans so if you know a vet you can help by researching mortgage brokers in your area who are experienced with VA loans. Your broker must be fully registered with the Veteran's Administration which is different from FHA although they price their loans using Freddie Mac funding. Today's VA rates compare favorably to FHA because the VA does not require monthly Mortgage Insurance (just an upfront MI fee funded into the loan) VA Loans are usually .25% higher than FHA and brokers charge accordingly for absorbing a good number of your upfront closing costs.
95% RE-FINANCING Veterans who have conventional mortgages or ARMS should definitely check out the VA loan offering. If you have owned your home for a year --refinancing may still be very worthwhile because last year VA rates were about 1% higher than today. VA does not charge a premium for taking cash out (as long as the value supports this) so using your mortgage to consolidate debt is a very good option these days.
ENTITLEMENT: Your entitlement depends on your level of active service: not less than 90 days (WWII, Korean War, Vietnam or active duty during wartime) or up to 2 years. If there is a shortfall in the loan amount allowed, the VA will require the Veteran to come up with the difference but not usually more than 25%. Loan limits have been raised to conventional $417,000 in 2008 as per the conventional guidelines in your state. The loan limits have changed recently so be sure and get qualified before you go house shopping in your area!
GETTING STARTED: With your DD-214 Discharge papers in hand, we can register and print out your entitlement papers on-line in about 15 minutes. Thankfully some of the paperwork and processes have become less onerous in recent years.
VA APPRAISERS: VA appraisers are sent out by the VA and their valuations are gospel. Saying that we have had very good results locally. They are NOT looking for excuses to devalue the property. Their main concern is that the property you are buying or refinancing is going to serve your long term needs. Naturally we all prefer homes in good repair that will not cost you a mint to make livable or maintain.
VA LENDING Our VA underwriters are very good at making sure the loan terms 'serve the veteran'. The guidelines are sufficiently vague on some points to allow them to exercise their judgment on certain details. In one case, a Veteran was purchasing a property with a second building that suited his business to a 'T'. My underwriter allowed us to credit rent of that building from his business (actual and document-able) as income because he could support the 'net tangible benefit' to his own bottom line. Neat, huh!
PRACTICE CREDIT WELLNESS! www.netcredit.blogspot.com Factoid: Many veterans who have been away from home may have experienced family financial pressures. Every citizen can order one free report per year at: www.annualcreditreport.com I recently checked mine and the good news is that the average human can not only retrieve their report (one per year, per bureau, per client) but actually understand it!
I recommend you check one Bureau (Experian, TransUnion or Equifax) box, get that bureau report and get another bureau in a few months if you have made any corrections, saving one for the end of the process.
Washington Licenses: 510-LO-31434 510-MB-24707-50145