UNTOLD FACTS ON BUYING ON A
VA Loan:
by C A MillerEld
A VA Loan is a fabulous benefit to use on your
home purchase for veterans. And it has its true
advantages. However I was disturbed by some
lack of details left out on some sites
advertising these loans. So fully understanding
the process before you begin qualifying for the
loan would be nice to know.
Yes pre-qualify that is fine. You can pre-
qualify yourselves by taking all gross incomes
of the buyers and taking 42% of it which will
be the allowable house payment and its
impounds paid monthly with the monthly
house payment.
Your interest rate (on articles I read) was to
be below market rates by 1/2 to 1.0 less. Not
totally true. The rate can be where your lender
tells you "You Qualify" which is hogwash. The
lender will be happy to get you the absolute
lowest possible rate if he/she is taken care of
commission wise. They get paid more the
higher they get away with convincing you the
rate on your deal is XXX and you believe this
and sign your note and deed of trust paperwork
therefore closing the process on that believed
to be the best rate you qualified for.
Not knowing the contrary is not common
knowledge. Don't feel bad if you've done this
and bypassed opportunity for much lower
house payments in so doing. The gift of
experience is what I am passing on to you here.
VA Loans require VA Appraisors to evaluate
the the homes market value when you hire
them to look at your prospective home to be
purchased.
The thing is NOT to have an offer written on
the home prior to this appraisers findings
because if so and if the value he/she writes the
market value to be must be below the price you
were offering to pay or else YOU will get to pay
the difference of your offer and market value
below your offer. The sellers will not
appreciate revoking the offer they've already
accepted from you. So market value above an
offer on the table is fine. You don't want the
value to come back lower. Money paid over
and above the VA appraisors value will be like a
required down payment of cash. JUST LIKE A
Down Payment. So leave it in the AIR and
don't rush to offer a particular offering-price
you will pay, until that appraisor is finished
writing the evaluation on that property, giving
their opinion of its market value.
The "Price" of a home up for sale even being
stated prior to the appraisal being done is
fantasy or dreamland really. The owners say
they want $450k and the buyers think it will be
worth their while to offer $425k and the
appraisal comes in at a conservative $389.
Well if the contract is that their buying it for
$425, what they offered the sellers, the
difference between the $389 and the $425 will
be made up by the buying participants in that it
will be cash down they come to the closing
table with because the VA Lender can't exceed
VA Appraisal Value in their financing amount.
Sellers can help with some closing costs, and
in so doing you will best pay your loan officer
points above the normal origination fee with
some of the sellers gratuitous closing cost help
and buy down to the lowest rate possible.
Don't play games here.
The loan officer works very hard and puts in a
ton of hours getting the i's dotted for you on
your home loan. It is not an easy job to meet
the demands of their loan underwriters and
meeting deadlines and timelines required is
very intensive work on the part of your loan
processing people. So let them enjoy good
compensation-they do deserve. Realtor's wine
and cry insults at the meager points charged by
lenders...exasberated like they were paying it
themselves on their contractee's home
purchase.
This is why lenders are reluctant to disclose
on the front-side any points for themselves to
be paid from, and instead mess with your mind
a little on why the interest rate was higher than
expected.
When really it is so to have back-side points
rebated back to the lender from which the loan
processing/loan officer can be paid from. To
mitigate agressive snivelling Realtors- whose
business it is not - anyway. Yep. Realtors
have found their way to recking economies and
greed based practices form the center of the
fall of the market here that we suffer now.
More about "that" later,,,
Hoping to be helpful, yours truly, C A MillerEld
6-14-2011
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