If you are active duty or you are a Veteran, you are probably already aware of your VA loan benefits. However if you are not, if you are serving here at Fort Huachuca or have served and were discharged honorably you are entitled to a Veterans Administration Insured loan. Please contact me directly if you have questions concerning your entitlement and I will help you find out the answers to your questions. Securing a home loan can be a difficult and frustrating ordeal.

The current loan limits for a VA loan is $ 417,000.00. You are not automatically qualified for that amount, but it is the maximum amount the VA will insure (in other words the maximum you can borrow under a VA loan).

First time users with 0 down payment pay a VA funding fee of 2.15%, this changes with how much money you put down:

0% down you pay 2.15%

5% down you pay 1.5%

10% or more you pay 1.25%

Subsequent (more than one time) users the funding fee is 3.3% but may go down the more downpayment you put down, as above.

The reason VA loans have been so popular in the past is because it is a 100% loan that requires no mortgage insurance to be payed by the buyer in their payment. (That is because the VA is guaranteeing the loan for you). If you did not have access to a VA loan you would pay extra, each month in the form of "private mortgage insurance" or "PMI" if you put down less than 20% when you bought your home. This is a substantial savings to VA borrowers.

However, if you have enough money to put down so that you do not have to pay "PMI", you may want to consider a convential loan instead of a VA loan because the funding fee can be quite substantial.

For example if you are a first time user of your VA loan (and are not putting any money down) and the property is selling for $300,000.00 you will pay $6,400.00 to the VA to make your loan. So your loan will actually be for $306,400.00. Many people forget about this funding fee and when they go to sell their homes and they owe more than they thought.

Using the same example if it is your second time using your VA entitlement (and you are putting no money down) and the property is selling for $ 300,000.00 you will $9,900.00 to the VA to make your loan. So your loan will actually be for $309,900.00.

As you can see if you have a downpayment large enough to get rid of mortgage insurance it does not make sense to use your VA entitlement.

Although there are other reasons to use a VA loan (such as it is not credit driven), the downpayment is one of the largest considerations.

A few of the things you should understand as a VA buyer (or seller considering whether to accept a VA loan), are as follows:

Most, but not all, lenders offer VA loans. Ask your lender of choice whether they offer VA home loans. This will eliminate a lender pulling your credit and then not being able to give you a VA loan (which, as you know if you visited my "Did you know" section...each credit report pulled can lower your score).

Let me know right away that you are considering a VA loan purchase. Homes that do not have VA listed as finance option may still entertain offers from you, so do not just shop for homes that list "VA" as a finance source. Some agents tell their sellers not to put yes for VA because it may cost them more, however, this is not true anymore. But because agents are playing catch up with constantly changing lender information they do not know this. So look at all the homes you are interested in, just make sure that I or your buyers agent knows that you are considering using a VA loan up front.

The VA does not make loans, they insure loans. The banks makes the loan and then the VA says "We guarantee this person will make the payments or we will pay this loan off and take possession of this property ourselves". (That is where VA/HUD repossessions come from.)

There are a few differences between convention loans and VA loans. One major difference has to do with the appraiser.

The VA requires the bank/lender to use appraisers that have a special certification to appraise for the VA.

Buyers and Sellers sometimes confuse a VA appraiser for a home inspector.

A VA appraiser does not inspect the property - you will need to hire a qualified home inspector for that purpose. But (and this is the part that can confuse some buyers and sellers) the VA appraiser, when doing the appraisal, can make notes to the VA on things they see that they feel need to be fixed before the VA to insures the loan.

As a result the VA then requires the repairs to be made before they will guarantee the loan for the lender. However, the appraiser only notes obvious repairs and does not do any type of intense inspection...so make sure you hire a qualified home inspector!

This is the biggest obstacle to sellers wanting to allow VA offers, but unless the home is older or requires substantial or obvious repairs is usually not a problem.

Another area where there tends to be a bit of uncertainty with both buyers and sellers is if there are any "required" cost to the seller.

It used to be the seller had to pay for the termite report or a set amount of the borrowers fees. This is not true anymore, now these are all negotiable and vary from lender to lender. Occasionally a lender may have some requirements but these should be disclosed to the buyer and by the buyer (through the Realtors) at the time of offer so that the seller can make a decision based on full disclosure of information.

You need to ask your lender if there is anything you cannot pay for in your loan!!!

If you are a VA buyer you need to talk to your lender PRIOR to making an offer on a property to find out if they (your chosen lender) require the seller to pay anything towards you buying their home.

Then you need to inform your Realtor so that there are no surprises or issues that may arise out of not disclosing your lender requirements at time of offer.

Many buyers have questions about VA/HUD repossessions. Where can they find them and how do they make offers. There are public web sites dedicated to listing VA foreclosures, they are not typically listed in the MLS. Conventional loan (non-VA) repossessions can be found in an area MLS, but the VA has its own marketing strategies.

Active Duty Buyers and Sellers

Please let me know if you are a buyer or seller who is on active duty here at Fort Huachuca. I understand the need for flexibility with underway and deployment schedules. Having a power-of -attorney in place to help the non-deployed spouse to handle the transaction is a must.

Different attorneys require different types of power-of-attorneys. The military general power of attorney DOES NOT always work for a specific real estate transaction.

Please contact me and let me know what your potential for deployment is and we can go over how I can best help you and your family handle your real estate transaction.

I can also let you know where the nearest exchanges and medical clinics are in relationship to where a property is located.

I do understand you have specific needs unique to the military families!

Again, "Thank you" to you and your family for all you do and put up with!