Why should a seller consider an offer with VA financing?
VA loans were one of the most important parts of the original Servicemen's Readjustment Act of 1944. They were created to aid in the economic and sociological problems of post war readjustments of millions of men and women then serving in the Armed Forces.
If you’ve been in the real estate industry for more than 10 years, or have been trained by someone who has, you may have an aversion to a transaction involving a VA loan. Maybe you can’t put your finger on exactly why. They take longer? They cost more to the seller?? Appraisal requirements too tough??? The loan amounts are too small????
Here’s another favorite: why not just use an FHA loan? VA loans are a benefit to the Veteran and here are two of the biggest reasons: no down payment is required up to a loan amount of $417,000. If the Veteran does choose to make a down payment but it is less than 20%, there is NO monthly mortgage insurance.
Here are some reasons your Seller should JUMP at an offer with VA financing:
· VA only provides fully documented loans. Our Veterans have been qualified on income and asset documentation under criteria more rigorous than normal conventional guidelines. Not to mention that they have also provided proof of service to our country with an honorable discharge.
· We live in a world of technology and the internet so yes, even VA loans are automated and take no longer to process than conventional or FHA financing. With few exceptions, a VA loan can be processed in a traditional 30-day escrow.
· Non-allowable closing costs to the Veteran in most cases can be covered by a 1% credit. The credit can be given by the seller (most common) but can also be covered by the lender OR any interested party including the real estate agent.
· Appraisals are ordered online through the VA Portal website. Unlike FHA, which can sometimes require “cosmetic” corrections, VA appraisals are interested mainly in health and safety issues (in addition to value of course!).
· Lenders who can provide VA mortgages have met stringent standards.