Getting A VA Loan
Advice On Getting A VA Loan
Getting A VA Loan is limited for home buyers or mortgage loan borrowers who are veterans of the United States Armed Forces who have a Certificate Of Eligibility and can meet the mortgage lending guidelines of the United States Department of Veteran Affairs. VA Loans is hands down the best loan program out there today where there are no down payment requirement and the closing costs can be covered through a sellers concession or a lender credit where there can be zero out of pocket dollars from a VA home buyer. Unfortunately, not everyone can qualify for a VA Loan. Being eligible for a VA Loan is one of the greatest benefit of being a veteran of the U.S. Armed Forces. VA Loans have the lowest mortgage rates out of all mortgage loan programs and there is no monthly mortgage insurance premium on VA Loans. The VA upfront funding fee can be rolled into the balance of the VA mortgage loan. If you are a home buyer with a VA Certificate Of Eligibility, you are in luck. The first step you need to do is research on a VA mortgage lender who you feel comfortable working with. VA mortgage lenders aggressively advertise on television, cable tv, radio, newspapers, and the internet. Keep in mind that VA mortgage lenders who advertise are private banks and mortgage lenders who have no affiliation or endorsement by the Department of Veteran Affairs and many of them try to mislead the viewer by having them think that they are part of a government agency and that by dealing with them that they will get special treatment. There are many VA mortgage lenders who have gotten fined for such advertisement and some VA mortgage lenders have even gone out of business because of misleading and deceptive advertisement. Make sure that you do your due diligence when selecting the VA mortgage lender. Check them out on the internet and make sure that they do not have any disciplinary actions against them and check out their reviews online. Today’s power of the internet, you can get a lot of information by Googling the loan officer and the company they represent. Keep in mind that there are always two sides of the story but further due diligence is required if the mortgage loan officer has pages after pages of poor reviews and testimonials year after year.
Getting A VA Loan: Get A Solid Pre-Approval
The pre-approval stage is the most important phase of the mortgage process. The reason of last minute mortgage denials or stress during the mortgage process is because the mortgage loan originator did not pre-approve the VA mortgage borrower correctly. Unfortunately, many loan officers issue pre-approval within minutes of looking at the borrower’s credit score and some do not even look at tax returns or even look at the borrower’s credit report. Just seeing if the borrower’s credit scores qualify is not good enough. A loan officer needs to review the borrower’s credit report and payment history. Most mortgage underwriters will deny a VA loan application if there are any late payments in the past 12 months. If the VA mortgage borrower has a prior foreclosure or deed in lieu of foreclosure, the loan officer should carefully check to see when the recorded date of the foreclosure and/or deed in lieu of foreclosure was and not just go off what is reporting on the borrower’s credit report. Credit bureaus do make mistakes and public records should be carefully reviewed thoroughly. Stay away from a VA loan officer that will issue you a pre-approval letter minutes after taking your mortgage loan application and not asking you for two years tax returns, two years W-2s, and your most recent paycheck stubs. Tax returns are extremely important because unreimbursed expenses will negate your gross income and many times if you have way too much write offs on your tax returns, this will disqualify you for a VA Loan. A pre-approval letter should be issued once the loan officer has extensively interviewed the VA loan borrower and has checked the borrower’s credit scores, credit report, payment history, income docs, and public records if any.
VA mortgage loan borrowers need to get their Certificate Of Eligibility. The VA mortgage lender should be able to get the certificate of eligibility for you. It is not too difficult to get the certificate of eligibility. The veteran can do it themselves by downloading it and completing the request and mailing it with the copy of the veteran’s DD214 form.
Getting A VA Loan: Selecting A Real Estate Agent
Once you are armed with a solid pre-approval letter, you are now ready to enter into a real estate purchase contract. Your next step is choosing a real estate agent who you feel comfortable working with. Just like how you chose your mortgage lender, you should carefully select a real estate agent who you feel comfortable with. Make sure that you check out their referrals by reviewing their online reviews and testimonials. Make sure that they return your phone calls promptly, preferably 7 days a week. If a real estate agent and/or loan officer does not return your phone calls or emails at the early stage of your home buying process, that can mean trouble. Remember that the home buying process is a process and it normally takes anywhere between 30 days to 60 days to close on a home loan. You are not in any obligation that you need to continue with a mortgage loan officer or realtor throughout the whole home buyer process. You can fire your loan officer or real estate agent if you are not happy with them and are not contractually obligated to them.
Getting A VA Loan: Entering Into A Purchase Contract
Now you are armed with a solid VA pre-approval letter and are on the way of getting a VA Loan and with a real estate agent, can start shopping for a home. Once you choose a home that you want to purchase, you will place a real estate purchase offer. Your real estate agent will assist you when you place a real estate offer on the home you want to purchase. VA allows up to a 4% in sellers concession from the home seller where it will help you pay for all or most of your closing costs on your home purchase. It is extremely important that the purchase contract states all of the contingencies such a financing contingency, home inspection contingency, and appraisal contingency. The contingencies are stipulations where it will enable you to cancel the real estate purchase contract and get your earnest money back. Once your real estate purchase offer has been accepted by the home seller, the ball is in motion and your mortgage loan officer is ready to start the mortgage loan approval process. A home appraisal will need to be ordered by your mortgage lender. However, your home inspection, which is not required by the Department of Veteran Affairs, is normally done prior to the home appraisal. If by any chance the home inspection report is not satisfactory to your standards, you can opt to cancel the whole real estate transaction. If the home inspection meets your standards, then the home appraisal is ordered. You mortgage loan file is processed and is assigned to a mortgage underwriter. Once the mortgage underwriter reviews your mortgage file and you meet the VA mortgage lending guidelines, the VA mortgage underwriter will issue a conditional mortgage approval. The mortgage file is sent back to the mortgage loan processor and the loan officer so they can gather all the conditions listed on the conditional mortgage loan approval. Once the conditions are met, it is sent back to the mortgage underwriter for final review. If the mortgage underwriter is satisfied with all of the conditions, then the VA mortgage loan underwriter will issue a clear to close. A clear to close means that the VA Loan is ready to fund by the VA mortgage lender and the mortgage docs is ready to go out to the title company. The closing department of the VA mortgage lender will contact the title company and set a closing date. The closing is where the funds gets wired and all paperwork is signed by both the home seller and home buyer. Buyer gets the keys to the property and the home seller gets the proceeds of the sale. Getting A VA Loan is not difficult at all. The above explains the steps in Getting A VA Loan for a veteran with a Certificate Of Eligibility.