VA loans are guaranteed by the United States Department of Veterans Affairs and enable Veterans to have an easier time financing their home. If you’re considering a VA loan, here’s everything you need to know about VA financing.
☆ A Veteran, active duty, or honorably discharged may be eligible for a VA loan if he/she meets the following requirements:
☆ Served 90 days of active service during wartime
☆ Serviced 181 days of active service during peacetime
☆ Has more than 6 years of service in the National Guard or Reserves
☆ The borrower is the spouse of a service member who has died in the line of duty, or as a result of a service related disability
Who Can Be On the VA Loan?
☆ A Veteran and his/her spouse
☆ VA allows Joint Loans
★ A Veteran and another person (other than spouse) will be on the loan
★ A Veteran and their spouse will both be using their entitlement
★ All Joint Loans will need to be underwritten by the Regional Loan Center for prior approval
★ Since VA requires a 25% Guaranty to be maintained on all VA loans, a down payment will be required when a Veteran and non-Veteran spouse are purchasing a home together
Seller Concessions—the Benefit of VA Loans
☆ Seller can pay 4% of concessions on top of closing costs*
★ Payment of buyers funding fees
★ Pre-payment of buyer’s property taxes and insurance
★ Payment of points to buy down rates
Photos Required on the Subject Property
☆ Exterior- Front and rear at opposite angles to show all sides of dwelling and street scene.
☆ Interior- Kitchen, main living room, bathrooms, bedrooms, and any other room representing overall condition, basement, attic, and crawl space, recent updates, photos of deficiencies or conditions requiring inspection of repair.
☆ Condos- Need additional pictures of common areas and shared amenities.
Types of Construction
☆ Existing- 100% complete for over a year or less than a year if it has been previously occupied.
☆ As Is- Subject to the following repairs:
★ If there is an indication of a potential environmental problem, the appraisal report must contain a requirement for correction of the problem in accordance with local, state, or federal requirements.
★ Appraiser may not recommend electrical, plumbing, heating, roofing, or any other inspections only as a measure of liability protection. An inspection should only be recommended if there is an indication of a complex problem requiring a professional opinion such as pests, site drainage, structural defects, safety concerns, code violations, etc.
☆ The appraiser should limit repairs to:
☆ Maintain safety, security, and soundness of the property
☆ Preserve the continued marketability of the property
☆ Protect health and safety of the occupants
Things That Require an Inspection
☆ Standing water against the foundation or a damp basement
☆ Hazardous materials on site
☆ Faulty or defective mechanical systems (electrical, plumbing, or heating/cooling)
☆ Evidence of possible structural failure (settlement or bulging foundation wall, cracks in the walls or foundation)
☆ Pest Infestation
☆ Leaking or worn out roofs
☆ Paint (cracking, scaling, chipping, peeling, or loose paint)
☆ Lead Based Paint constitutes an immediate hazard that must be corrected (properties built before 1978)
☆ Appliances that are to remain and that contribute to the market value opinion must be operational
☆ Freestanding appliances that do not contribute to the market value do not have to be present or in the working order
☆ Built in appliances ALWAYS must be in working order
Remaining Economic Life
☆ The remaining economic life must be at least as long as the loan repayment term (usually, 30 years).
Our nation’s heroes deserve to achieve the American dream of homeownership. VA loans are there to help make it happen. If you would like to see if you qualify for this loan, contact one of our Licensed Mortgage Loan Originators. If you are ready to begin the process, click here to get started!
Veterans Affairs loans require a funding fee, which is based on various loan characteristics. Sales price cannot exceed appraised value. *In a purchase transaction, reasonable closing costs may be paid by the seller, and the program is available with no points depending on credit profile, collateral, and current mortgage history.
Recently, we answered the Top Five Questions About Jumbo Loans. This week, we will discuss VA loans. If you or your spouse is a Veteran or serving in the military and planning to purchase a home soon, these tips will help you decide whether a VA loan is right for you.
The Veterans Affairs (VA) loan program was introduced by the Servicemen’s Readjustment Act, also known as the GI Bill of Rights. These loans are insured by the United States Department of Veteran Affairs, and were designed to provide Veterans and service members with a federally guaranteed home loan with little or no down payment, so that they and their families can take part in the American Dream of homeownership.
Veterans and active duty service members are eligible for the VA loan program. The surviving unmarried spouse of a deceased Veteran may also be eligible for a VA loan. More information about eligibility for VA loans can be found on the VA website.
VA loan limits are the amount a qualified Veteran or active duty service member with full entitlement may be able to borrow without making a down payment. How much you can borrow with a VA loan will depend on your lender and the county you are buying your home in. The basic entitlement available to each eligible Veteran or active duty service member is $36,000; lenders will typically lend up to 4 times a Veteran’s available entitlement, if the Veteran’s income and credit qualify.
VA loans will finance up to 100% of your home purchase, meaning that you may be able to purchase a home with no down payment.
Most Veterans purchasing a home with a VA loan will be required to pay a VA funding fee. The purpose of this fee is to reduce the cost of the loan to taxpayers, as the VA loan requires no down payment and often no private mortgage insurance (PMI). The amount of the funding fee depends on the loan amount, loan type, and your military category. Some VA home buyers are exempt from having to pay the VA funding fee.
VA loans offer no down payment requirement (for qualifying consumers) and often do not require PMI. Additionally, Cash Out Refinance loans allow you to take out up to 95% of the appraised value of your home as determined by VA. Some states also offer additional resources to Veteran homeowners, such as property tax reductions.
If you are a Veteran or active duty service member, you may be able to take advantage of the benefits offered by the VA loan program. For more information about VA loans, please visit the VA website. If you have more questions about buying a home with a VA loan, contact one of our licensed Mortgage Loan Originators. If you are ready to begin the home buying process, click here to get started!
*100% financing is available, sales price cannot exceed the appraised value. ** Veterans Affairs loans require a 1st time funding fee, which is based on various loan characteristics, your actual loan amount may be higher than the purchase price.
LINTHICUM, MD, March 21, 2016— NFM Lending is proud to announce the beginning of its latest charity initiative, the NFM Salute. This program, launched March 15, 2016, will honor veterans and active duty military members, giving them the recognition they deserve for their service to our country.
The NFM Salute will choose one military member or veteran each month to honor as their “Salute of the Month.” Salutes will be chosen from nominations on the NFM Salutes website, www.nfmsalute.com. The “Salute of the Month” will be featured on the website with a brief biography and information about his or her service, and NFM Lending will make a $2,500 donation to a military or veteran non-profit in the Salute’s name (select charities listed below).
“The NFM Salute program is a continuation of our efforts to honor those who have served or are currently serving in the U.S. Armed Forces around the world,” said David Silverman, CEO. “From our vantage point, we can never do enough. We will continue to look for new ways to pay it forward to those brave and courageous men and women who inspires us all.”
Military and veteran causes are important to NFM Lending. For the past eight years, NFM Lending has held a Support Our Troops Drive, collecting items for care packages to send to U.S. troops overseas. In addition to employees and employee family members who are active military or veterans, several members of NFM’s executive team are veterans, including Fred Sujat, Chief Compliance Officer.
“Having served in the U.S. Air Force as a Judge Advocate for over thirty years, I salute NFM for its recognition of all those veterans who, over the years, took time from their families and the comforts of their homes to serve our Nation,” said Sujat.
Selected NFM Salutes may choose from one of several non-profits that support active military members and veterans, including Platoon 22, AnySoldier, Soldier’s Wish, and the Gary Sinise Foundation. NFM looks forward to the opportunity to continue to honor our military and veterans through the NFM Salute initiative.
For more information please contact:
Toll Free: 1-888-233-0092
About NFM Lending
NFM Lending is a mortgage lending company currently licensed in 27 states in the U.S. The company was founded in Baltimore, Maryland in 1998. They attribute their success in the mortgage industry to their steadfast commitment to customers and the community. NFM Lending has firmly planted itself in the home loan marketplace as “America’s Common Sense Residential Mortgage Lender™.”
For the online press release, click here.
Written by Guest blogger: Sherman Hardy
Foreclosures and its counterparts (short sales or deed-in-lieu of foreclosure) can be extremely problematic for military buyers. For those who have faced foreclosure may or may not know that it was not in their best interest. Having a foreclosure means you will not be eligible for a VA loan for at least two years. Borrowers who experienced the loss of a home due to a foreclosure proceeding will not be able to purchase for two years after the deed is transferred from their name.
I wanted to clear the misconception about VA Home Loan Guarantee Eligibility after a foreclosure; a veteran who has a VA loan foreclosed upon can obtain another VA loan in the future. Many service members have been told otherwise by bank officials, mortgage brokers and others who either didn’t understand the program or who were looking to make a buck with their own financing options.
When a veteran home has been foreclosed upon the lender must determine how much of a primary entitlement the borrower has left (if any at all). This is where a second-tier entitlement comes into play. One of the downsides to a second-tier entitlement is there’s a minimum loan amount of $144,000. This secondary entitlement is also used to allow a veteran to have two VA loans at the same time.
Sherman Hardy, Real Estate Professional, 301-659-5004 or www.localdmvhomes.com
*This blog is for information purposes only. NFM, Inc. accepts no liability for its content. Please visit the US Department of Veterans Affairs website for more information: http://www.benefits.va.gov/.