First time home buyer using a VA Loan...?

Question

My Husband comes home from Iraq in a month, and we are going to buy a house as soon as he gets home. I've heard that a VA loan takes a while to process and what not. So my question is, how long does it take from when he gets home, until he gets his VA papers, and then after we find a home, how long does it take to complete the whole process with a VA loan?

Also, we have about 10K saved, and had planned on using it for a down payment. Should we use it all for a down payment? or use just some and save the rest? Or save all of it and not put any down?

Answer 1

IF you have a pa then you can contact and start the ball rolling with the paper work now, the only hold with our va loan was the waiting for them to finish a road leading into the estate other than that it was a fairly quick process, you can start looking for the house now and seeing who will accept them...........some will not.

and as for the down payment well I would IMO save it as we put nothing down other than about 2 thousand and this was on a brand new house.............

New houses have better chances from what we was told of getting thru with little to no hiccups as the VA has certain rules regarding house inspections etc etc

One place to chat with regarding a mortgage is Citimortgage as they are well used to dealing with VA mortgages and in own experience / what others have said they have not had any problems...also I would start to call around on getting quotes for house insurance.......you can give them a rough idea of what sq. ft. you are looking at

Wen you say VA papers is he retiring after full tenure ??? ie 20+ years ??? as if this is the case PLEASE hold onto your deposit as it took them nearly 7 months to sort out us getting ANY MONEY from them [and this seems to be the norm as well]

Answer 2

Using a VA loan is not difficult. You usually have to show proof of being in the military, but a loan ageant can square all of that away for you. The best thing with a VA loan is that you can finance 100% with nothing down. If you want a lower payment you can put some money down, but pending on the cost of the house and the amount of the loan you are appling for, you might need the 10K for closing costs. If you can roll the closing in with the house, then you can save the money for new furniture or a nice vacation. Also with a VA loan it takes time for a VA inspector to come out and some are very anal. First thing you should do is get a free credit report from www.annualcreditreport.com to see how you and your husband stand. Good luck. SEMPER FI (USMC)

Answer 3

I haven't done a VA purchase in a while (Maximum VA loan buys a decent condo around here, but with collapsing values and VA limit raised to $417,000, that may change!), but my understanding is that the delay has lessened. You can start the paperwork for generic approval now, that way you have some stuff done when you find a property.

Here's the VA Home page

http://www.va.gov/index.htm

(Their loan page has a glitch right now)

As for the down payment, it never hurts to owe less money. But depending upon the property you choose, you may want to save it out for repairs or renovations. In other words, can't tell you from here. VA loans do go to 103% of purchase price, so you can pay your closing costs

VA loans are generally not as good as A paper conventional as far as rate/cost tradeoffs. But if you have less than stellar credit, they're a heck of a lot better than subprime, and if you don't have a 10 to 20% down payment, they might end up saving you money as the government guarantee beats splitting your loan in two pieces or paying PMI.

Answer 4

VA paperwork doesn't take nearly as long to process as it used to but you are talking about a month's time. Watch the interest rates to see if they are steady, rising or falling: for example if we would be in a time of rising rates, you'd want to lock in a rate as soon as possible. VA loans generally even cover the closing costs. I won't advise on what to do with the 10k but if it is a brand new house, there are lots of items to buy. If your credit is good, a 15 year mortgage is way better than 20 or 30 years because of the tremendous amount of interest saved over the life of the loan. Not a good idea to get a variable rate. Depends on how long you plan on owning the house/amount of payment one can afford for how long of a time the mortgage payment is . If your husband is active duty, the average turn around time is 5 years or less, just enough time to get some escrow and resell when you go on to another base.

Answer 5

I would suggest you speak to a mortgage broker. Ask a variety of mortgage brokers from local loan companies to banks/credit unions, what options they would suggest to you and determine which answer fits your needs, situation, and budget.
Although VA loans have many perks and can be used over, there are many other Conventional loan options that are very good to use and can be many times better than a VA or FHA loan. In NM, VA loans require that the Selling side pay for a large portion of closing costs. This would be good for you but can also limit your Realtors negotiation power with the overall home price and fees. If your looking in NM, email me or visit my website. I'll gladly help you.

José
http://www.ExitYourHome.com

Answer 6

Get your preapproval now. This way, going into the process, you know what you qualify for. If you use USAA insurance, start with them.
USAA also has a realtor recommendation program, so if you're not sure, they can help you find a realtor in your area.

You need to plan on being in the house 3 yrs. We lived in 15 homes in 22 yrs in military and would have lost money had we tried to buy a home. Consider carefully why you want your own home. If your husband is separating from the military, he's likely to find a better job away from where you are now.

Good luck...

Answer 7

Hello - Here is some information on Va Loans, hope it helps.

VA Loan Information: Visit the home page of the VA. http://www.va.gov/

http://www.vamortgagecenter.com/

The VA has increased their loan limits! The maximum loan amount in most cases is $417,000. The VA also offers some advantages over conventional loans:
Other benefits of a VA Loan:
1. No Down Payment required at closing
2. Lower closing costs than conventional loans
3. No prepayment penalty if you pay off your VA loan early
4. No monthly Private Mortgage Insurance payment
5. The lender is willing to negotiate your interest rate

GOING TO THIS SITE, IS A MUST: http://www.homeloans.va.gov/veteran.htm

ON THE HOME LOAN: THERE ARE Pamphlets on the VA Home Loan Program
http://www.homeloans.va.gov/pamphlet.htm

VA Benefits: 1-800-827-1000
Burial, Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA)
Death Pension, Dependency Indemnity Compensation, Direct Deposit, Directions to VA Benefits Regional Offices
Disability Compensation, Disability Pension, Education, Home Loan Guaranty
Life Insurance, Medical Care, Vocational Rehabilitation and Employment
Education (GI Bill): 1-888-442-4551
Health Care Benefits: 1-877-222-8387
Income Verification and Means Testing: 1-800-929-8387
Life Insurance: 1-800-669-8477
Mammography Helpline: 1-888-492-7844
Special Issues - Gulf War/Agent Orange/Project Shad/Mustard Agents and Lewisite/Ionizing Radiation: 1-800-749-8387
Status of Headstones and Markers: 1-800-697-6947
Telecommunications Device for the Deaf (TDD): 1-800-829-4833
For health care services, contact your nearest VA medical facility.

With the rates still being low, you could go conforming (if your credit is good) and get 100 percent financing (with NO MI). Or, if your credit is lower (with a 580 + ) middle score you would be going sub-prime, and the rates are higher. But you can still get the 100 percent financing you are needing.

Talk with a Broker who can underwrite for other Lenders. One that can also do VA and FHA, Conforming, and Sub-prime. Most do, but others do not do VA & FHA.

ADDITIONAL HELPFUL INFORMATION TO KNOW

Decide on how much you want to spend, if you want to escrow the taxes and insurance. Say the taxes are 1200 a YR and insurance 800 a year (just an estimate, ok) That is 2,000 a year divided by 12 = 166.66 If you paid 1,000 a month now - (166.66) your P/I Principle and Interest would be 833.34. Now you decided on the price range you are looking into. If you have great credit, a 1 loan at 130,000 at a rate of 7 percent over a 30 year time would be 864.89 - This is just a estimate - ok -

It greatly depends if you need help with closing cost, (The seller could do Seller Help toward your closing cost). If that is the case, I normally tell my clients NOT to hackle over the price, since you are asking for closing cost help - especially if the home is thur a realitor, and the seller has to pay the realitor their fee which runs from 2-6 percent of the selling price, and you ask for 4-5 percent toward closing cost -assistance) Follow me so far??

Talk with a broker, a broker underwrites for many company's (I underwrite for 150 companies) so I only have to pull credit 1 time, and they look at my credit. A single lender (not a broker) has programs available, but they may not be able to help you and your situation, so you go elsewhere, and than that person pulls your credit (see what I mean.) If you shop, your credit is pulled and that is considered a soft pull, for a 30 day period. Just like shopping for a auto, it is good for 30 days. If you apply for a credit card, that is considered a "hard" pull and it drags down your credit score. When looking for a home, please do not apply for a credit card, Department Charge Card, Gasoline Card or make any major purchases, like a auto, etc. This will pull your credit down

Try to find someone (broker) that will pull your credit one time, and submit your loan application to company's that will go off his credit report. By the way, a loan application is called a 1003, and they will issue you a GFE (Good Faith estimate, with-in 3 days, that is per the RESPA laws, and the TIL (Truth in Lending). This will tell you the up-front closing cost (etc) associated with your loan. This is a estimate only - not the final - but it does help you figure things out.

Lenders look at the middle score...of the 3 scores. If you only have 1 score or 2 scores (have seen it), it is still workable....but unless a lender sees the whole picture - credit - income - job time, etc - than you will not have a "true" picture of what you can afford - Hope this helps - There are also Government programs out there, but they too are looking for job time, etc.....They are not so much looking a credit - but the other factors are taken into consideration. With a government loan - collections and judgements will have to be paid (most ppl do not know that) but for FHA it is true

home values Just add 10-15 percent to the values on this site.:
http://realestate.yahoo.com/Homevalues

http://www.fanniemaefoundation.org/...

http://www.fha-home-loans.com/

http://www.freddiemac.com/

Answer 8

1

Answer 9

Go to these websites for information about vets returning from Iraq. There may be special privileges they are entitled to over the conventional veteran servcies. Good Luck and tell your husband, from one vet to another...THANK YOU!

www.va.gov
http://usgovinfo.about.com/cs/veterans/a/vareachesout.htm?terms=military+va+loans

Answer 10

The answers above are great.
Since you're a first time buyer, if you'd like to visit my page, I have several reports that may be of help.
They are Free.
If you'd like to be contacted by a pre-screened REALTOR®, please let me know. The reports are general enough to where they would apply nationwide.

http://www.myhomeinvegas.com