Bad Credit? Think you can't buy a home?
Goto Bad Credit Home Finder
and learn how
you can still buy your own home.
How Does The Veterans Benefits Act Of 2004 Affect Me?
Posted on October 28, 2009
Filed Under VA Mortgages | Comments Off
If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
There have been a number of changes to the legal regulations that underpin the operations and services of the VA as it regards home loans and other program. For many veterans, the provisions of the Veterans Benefits Act bring up many questions about how they may get a loan processing and what sort of entitlements will be available. What is this law and how does it affect you, the borrower?
The Veterans Benefits Act of 2004 was a comprehensive update that made significant changes to the VA loan process. One primary area of changes has to do with the maximum guaranty. While it was once $60,000, the amount has been modified. In the instance of those qualifying loans that are for amount of $144,000 or more, the maximum will be a sum equal to 25% of the Freddie Mac conforming loan limit. This, itself, will be determined by another lending law called the Federal Loan Mortgage Corporation Act.
Are There Issues That The Veteran’s Administration Will Cover?
Posted on October 14, 2009
Filed Under Loans, VA Mortgages | Comments Off
There are some things that are not covered by any provisions enacted by the Veterans Administration. More importantly, there are a number of situations or conditions that entirely out of the control of the VA to affect or influence in any way.
First, the VA cannot guarantee that a lender will provide financing to the veteran. This is based entirely upon the lender’s discretion. The VA has no authority to compel participating lenders to establish a loan that does not adhere to the lender policy or VA standards.
Second, the VA cannot make an explicit guarantee regarding the structural integrity of the home or make assurances that the property is free of defects. This is the obligation and responsibility of the veteran. Note, that an appraisal is not the same as an inspection. If you want to buy a house but have concerns about its integrity contact qualified residential inspector and have them come out and do a thorough inspection of the property before you commit to buy the house.
Third, if a veteran has a home built, the VA has no authority to force to build to correct any defects or faults in the construction. At the same time, the VA can have the builder suspended from future participation in its home loan programs.
The Veterans Administration deals within a very specific sphere of activities and offer specifically outlined services. These guidelines both establish and place necessary limits on what the VA may do.
What Things Do You Need To Apply For A VA Loan?
Posted on September 30, 2009
Filed Under Loans, VA Mortgages | Comments Off
The purpose of this article is to include a quick reference checklist that will assist the veteran by including all of the pertinent information and documents that will be required when you approach a lender. As an applicant, you will benefit from having all of this listed so you will know what you will need when filling out applications or consulting with an agent about your VA home loan.
Here is your short list:
• Social Security numbers
• Residence addresses for the past 24 months
• Names and addresses of your employers over past 24 months
• Documents stating current gross monthly salary
• Names, addresses, account numbers, and balances on all checking and savings accounts
• Names, addresses, account numbers, balances, and monthly payments for all currently open loans
• Addresses and loan information of other real estate owned
• Estimated value of furniture and personal property
• Certificate of Eligibility and DD214, (for veterans only)
• W2s for the past two years and current check stubs
• If you are self-employed, you must provide personal tax returns for the past two years, a current income statement, and balance sheet for the business
Try to review this and then make sure all of this information is gathered and ready to use when you begin applying for VA loan financing.
Have You Considered A Join VA Loan Or Cosigning?
Posted on September 16, 2009
Filed Under Lenders, Loans, VA Mortgages | Comments Off
According to the policies of the Veterans Administration, legally married spouses of those veterans who meet the qualifying provisions of the VA can be recognized as co-signors on VA home loans and include their income as well. These loans can be guaranteed in every way like others accepted by the VA.
Also, VA has provisions that deal with join loan ventures. These guidelines allow multiple veterans to purchase the home together. Furthermore, if more than one eligible veteran is involved in the application for financing, the VA will divide the entitlement charges between each party. These loans receive the full privileges of any VA guaranteed loan.
Another provision at least will allow a non-veteran to co-sign on a mortgage while not affording full guaranty status for the loan. In this case, the VA Guarantee provides for only a portion of the loan that is the veteran’s part or interest in the property.
Do You Know The VA’s Stance On Occupancy Law
Posted on September 2, 2009
Filed Under VA Mortgages | Comments Off
There are a number of very specific requirements that the borrower must meet in order to get the benefits of VA loan financing. Among those requirements, there are those that have to do with occupancy, meaning the borrower’s living arrangements.
In fact, the law states that those veterans who have gotten a VA-guaranteed home loan must verify that they have every intention of personally dwelling on the premises, and maintain the property as their primary residence. Once this has been certified in writing, the veteran is obligated to move in and take up residence immediately or must intend to do so within sixty days after the closing.
These general requirements are applicable and enforceable for most types of loans that have been guaranteed by the Veterans Administration. The only exception is in the case of IRRLs or Interest Rate Reduction Refinancing Loans. With IRRRLs, the veteran is only required to certify that he or she previously occupied the property as a normal residence.
Some Essential Facts About VA Debt-To-Income Ratios
Posted on August 19, 2009
Filed Under Loans, VA Mortgages | Comments Off
As with other forms of loans, the debt-to-income ratio of veteran seeking qualification for a VA loan is a major factor that is established by the Veterans Administration and used by the lender to determine if the borrower is capable of meeting all of the expenses associated with home ownership.
This ratio can be figured by adding the total mortgage payment (all elements of PITI) and adding them to all recurring monthly revolving and installment debt such as car loans and credit cards. This number is then divided by your gross monthly income. In order to qualify for a VA loan, your ratio must be at least 41%. For those borrowers whose number exceeds this percentage, the VA has different guidelines that govern what it calls residual income.
There are other factors can also help to determine whether you will be able to qualify for a VA loan. Some of compensating factors include good credit history, limited use of consumer credit sources, minimal consumer debt, long-term employment, military benefits, liquid assets, etc.
Can Bankruptcy Affect Your VA Loan Eligibility
Posted on August 5, 2009
Filed Under VA Mortgages | Comments Off
Is it possible for bankruptcy to affect a veteran’s eligibility for a VA home loan? In other words, what happens if you file bankruptcy, but you would like to purchase another home at some point in the future? Will there be any hindrances caused by your credit status?
If you are a veteran and you file for bankruptcy, you are still allowed to use VA home loans if you are also eligible under the standard VA policies. Of course, there is a downside. You will most likely be put through a required waiting period. This period is typically two years after the “discharge date” of the bankruptcy. Then you will be able to purchase another house. You need to understand that it is the discharge date and not the filing date that is the starting point of your waiting period.
When you are again eligible to buy another home, the standard credit and income requirements will apply when you are registering with the VA.
What Are Fees That Must Be Authorized By The VA
Posted on July 22, 2009
Filed Under Loans, VA Mortgages | Comments Off
Often, when you have a VA home loan there are other fees that may be charged, but which must be authorized by the VA to become applicable. It is the lender that will contact the local VA office seeking approval of these additional fees, which may be included among the closing costs. They may be assessed if they are typically paid the borrower in certain areas or jurisdictions or if they are considered reasonable and customary in the same district.
Take a look at the following fees, many of which that will be covered by the lender if not approved by the VA:
• document preparation fees
• preparing loan papers
• attorneys services other than for title work
• photographs
• interest rate lock-in fees
• postage and other mailing charges
• stationery
• telephone calls
• amortization schedules
• escrow fees or charges
• notary fees
• trustee’s fees or charges
• loan application or processing fees
• charges by loan brokers
• tax service fees
It is also possible that these fees can be incorporated with other closing costs into the cost of the loan and then paid by the seller. There is some room for negotiation in these matters, so it might be helpful to consult the real estate agent or even the lender when deal with this stage of the transaction.
How Can You Cut Down Or Eliminate Your Closing Costs?
Posted on July 8, 2009
Filed Under Loans | Comments Off
Many veterans have the mistaken impression that the closing costs for a home loan are actually covered by a VA mortgage. This is not true, although you can do a number of things to either minimize or total eliminate many of your closing costs. Most notably, this effect can be produced by thorough structuring of the real estate contract that you obtain.
When you apply for a loan, the amount may be the purchased price or the appraised value of the house, which ever ends up being less in addition to a VA funding fee. This means that if you would like to have your closing costs to be included in the loan, you need to increase the price. More than this, you must include a stipulation in the agreement, which says that the seller will pay the closing costs and other pre-paid expenses equal to the increased price.
This will eliminate your closing costs. Your appraisal value must also equal the value of the increased price for you to benefit from this arrangement.
What Are The Itemized Fees You Can Expect To Pay
Posted on June 24, 2009
Filed Under Lenders, Loans | Comments Off
There are a number of itemized fees and charges that make up loan closing fees. Some of these fees have to deal with initial acceptance of the applicant while others involved the paperwork, insurance, and survey among other things. Below is a list of the most common types of VA loan closing fees.
• Appraisal and compliance inspections
• Recording fees
• Credit report
• Hazard insurance
• Survey
• Title Examination and Insurance
• Flood zone determination (This may be assessed to the veteran to determine if their property is located in a special flood hazard area. These rulings are made by neutral third party providers.)
• Prepaid items (These fees include those that the veteran can pay a select point of like taxes, assessments, and similar items for the current year. Not only are there these costs but the deposit that goes towards paying for both tax and insurance accounts.)
• VA funding fee (Veterans are required to pay these fees unless they fall under established exemptions.)
These are the standard types of itemized fees you will have to pay if you have obtained a VA loan.
« go back — keep looking »