Sunday, October 21, 2007

Military: VA loans and the military home buyer

In the past several years, FHA and VA loans have become unpopular. Withe so many other options, options that were often "easier" for loan officers to get and process, federally-insured loans largely fell by the wayside. Now, the mortgage industry has tightened their guidelines significantly, and all those 100% loans are all-but-impossible to get in todays mortgage market.

Well, guess what? 100% financing is still available for some home-buyers, specifically those who can qualify for an FHA or VA loan.

I'll address buying a home with an FHA loan in a later post. For now, I'd like to discuss many of the myths and misconceptions held about using your VA loan to buy a home.

First, you do have to be a veteran, retired or active duty military. Many members of the reserves will qualify as well.

Second, you do not get your VA loan directly from the VA. You will need to apply for a VA loan with a loan officer at a mortgage company, just like you would for any other mortgage. The VA guarantees the loans for the lender in case of loss, they do not actually grant the loan.

Third, there is no such thing as a VA inspector. There is a VA appraiser. The appraisers job is to be certain that the house really is worth what the bank is giving you for your loan. The appraiser works for the VA, not for the borrower or buyer. The VA appraiser usually willl not look in, let alone go under, crawl spaces. The VA appraiser will not usually climb up into an attic. The VA appraiser will not usually remove the front of an electrical panel to check the wiring in back. Buyers need to hire their own home inspector, apart from the appraiser.

Fourth, you can use your VA eligibility more than once. The funding fee structure varies slightly the second time you use it, but you can use it again. You can actually use your VA loan many times, as long as your eligibility has been restored.

Fifth, and most importantly, please be sure that your real estate agent has experience helping clients buy homes using VA loans, both professionally and personally, if possible. Be sure your lender has also had numerous successful experiences using VA loans.

Our office actually teaches classes to all eligible service memebrs, retired and active duty, in how to use the VA loan to buy a home. We have had such a successful response to the class, that we are offering the classes on a monthly basis. Feel free to contact us if you would like more information. Realty Station can be reached at 360-377-5699.

My assistant/partner Terry and I are well-versed in VA loans, being Navy spouses and having used VA loans to buy our homes. We enjoy helping other military families make successful home investments!

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