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Answering Some Common VA Loan Questions
Manage episode 236989878 series 2380939
Content provided by Patrick Fitzgerald. All podcast content including episodes, graphics, and podcast descriptions are uploaded and provided directly by Patrick Fitzgerald or their podcast platform partner. If you believe someone is using your copyrighted work without your permission, you can follow the process outlined here https://ro.player.fm/legal.
I get a lot of questions about VA loans and the eligibility restrictions. Can you use a second VA loan? Can you rent a home purchased with a VA loan? Find out here. It doesn’t cost a penny to talk….so call me right now and I will answer your questions! Apply Now I’ve been getting a lot of questions lately from people, which is great. I wanted to answer a few of them today. One of the most common questions I get asked about VA loans goes like this: “Pat, I have used my VA loan to buy a home in the past, can I use it again?” The simple answer is absolutely yes. All veterans and active military have the benefit of using VA eligibility to buy a home. When someone uses it the first time, all they have to do is pay off the house or sell their current home, and it will free up their eligibility. “THE SIMPLE ANSWER IS ABSOLUTELY YES.” The other question I often get goes like this: “I already have a home with a VA loan on it, and I have been renting that home out. Can I buy another house with a VA loan as well?” Yes, you can have two VA loans at once, but there are some restrictions. You will have to fill out a form for us, and then we can insert those numbers and tell you how much more you can borrow on another VA loan in addition to your first. If you have any questions about this topic or any mortgage needs, give me a call or send me an email. I look forward to helping you.
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43 episoade
Manage episode 236989878 series 2380939
Content provided by Patrick Fitzgerald. All podcast content including episodes, graphics, and podcast descriptions are uploaded and provided directly by Patrick Fitzgerald or their podcast platform partner. If you believe someone is using your copyrighted work without your permission, you can follow the process outlined here https://ro.player.fm/legal.
I get a lot of questions about VA loans and the eligibility restrictions. Can you use a second VA loan? Can you rent a home purchased with a VA loan? Find out here. It doesn’t cost a penny to talk….so call me right now and I will answer your questions! Apply Now I’ve been getting a lot of questions lately from people, which is great. I wanted to answer a few of them today. One of the most common questions I get asked about VA loans goes like this: “Pat, I have used my VA loan to buy a home in the past, can I use it again?” The simple answer is absolutely yes. All veterans and active military have the benefit of using VA eligibility to buy a home. When someone uses it the first time, all they have to do is pay off the house or sell their current home, and it will free up their eligibility. “THE SIMPLE ANSWER IS ABSOLUTELY YES.” The other question I often get goes like this: “I already have a home with a VA loan on it, and I have been renting that home out. Can I buy another house with a VA loan as well?” Yes, you can have two VA loans at once, but there are some restrictions. You will have to fill out a form for us, and then we can insert those numbers and tell you how much more you can borrow on another VA loan in addition to your first. If you have any questions about this topic or any mortgage needs, give me a call or send me an email. I look forward to helping you.
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43 episoade
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×If you don’t already have a will, it’s time to set one up. Even if you don’t think you need one right now, the truth is that unexpected tragedy can strike at any time. Take, for example, a past client of mine who recently reached out to inform me of her husband’s passing. When I asked if he had a will, she said no. The widow assumed that all of his assets would become hers automatically, but this isn’t so. Inheritance laws do vary from state to state, but here in Texas, half of a deceased spouse’s assets will be given to their widow, and the other half will be divided equally between their children. This isn’t an unusual arrangement for people with wills to choose, but the point is that not having a will eliminates any agency you would otherwise have over how (and to whom) your belongings are given. “The time it takes to set up a will is well worth it.” Assets distributed without a will are also subject to heavy legal fees, meaning that none of the decedent’s beneficiaries will receive the entirety of what was left behind. Worse still, your estate cannot be passed on without first going through probate court, which is a very lengthy and expensive process. All of this can be avoided by simply getting a will. You don’t even need to go to an attorney to create one. All you need is to buy and complete a will kit, and then get it notarized. Of course, going to an attorney is also a good option for those willing to take a few extra steps. Whatever route you choose, it’s all well worth it to protect your assets, your wishes, and your loved ones’ futures. If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.…
A one-time close, or OTC, happens when a homebuyer wants to build a home on land they own, but needs a construction loan in order to fund the build. When the home is finished, then we create the 30-year mortgage to get them on down the road with it. The one-time close has many benefits. It pays off the land if you owe money on it, it provides funds to the builder to construct the home, and it builds in a 10% variant to accommodate any potential budget shortfalls. “You won’t have to worry about any closing costs or builder fees.” Upon completion of the home, the builder is paid and there’s nothing else for you to worry about. No appraisal issues, no closing costs, and no builder fees. If rates are better at the construction of the home than when you got the loan, you do have the option to lock in those lower rates instead. If rates go up during that same time frame, you’re protected at your initial rate. Our company allows this one-time close to be used with VA, FHA, and conventional loans. If you have any questions about one-time closes or anything else related to real estate, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.…
So you’ve decided to buy an investment property. What kind of financial regulations should you be aware of before proceeding any further? First, since I’m known as the “VA loan guy,” let’s get this out of the way: You can’t use a VA loan to purchase an investment property unless you’re purchasing a duplex, triplex, or quadplex and you plan on living in one of the units yourself. Investment property loans are always conventional loans, and the current conforming limit (the maximum for an investment property) is $484,350. The mandatory down payment for an investment property is at least 20%, and you can get a slightly better interest rate if you put down more than that. Speaking of interest rates, they’ll always be considerably higher for investment properties. “The mandatory down payment for an investment property is at least 20%, and you can get a slightly better interest rate if you put down more than that.” Also, you must have up to six months’ worth of cash reserves (or the equivalent of six monthly mortgage payments) in your bank account after you make your down payment and pay your closing costs. In other words, buying an investment property requires a good deal of cash. The seller can pay a small part of your closing costs when purchasing, but the limit is 2% of the purchase price. Can you count the current rents coming in? Absolutely, but only 75% of those rents. The reason why is this accounts for various long-term maintenance and insurance costs you’ll have to pay while owning the property. As always, if you have any questions about this or any other subject regarding VA loans, don’t hesitate to reach out to me. It doesn’t cost a penny to talk.…
In case you haven’t heard yet, the VA has eliminated down payments on all high-priced homes. Right now, the conforming limit on a VA loan in most areas is $484,350. For a home purchase below that price, there is no down payment and no issue. For purchases above that price threshold, VA buyers have to pay 25% of whatever the overage is. For example, a veteran will need a $25,000 down payment on a home purchased for $584,000. “This is a cool program we’re excited to learn more about.” Starting on January 1, however, down payments for homes above that conforming limit threshold will not require any down payment. If a veteran wants to buy a home for $1 million, they’ll be able to without any down payment. This is a cool program that we’re excited to learn more about. If you have any questions for me in the meantime, don’t hesitate to give me a call or send me an email today. It doesn’t cost a penny to talk!…
If you’re planning on buying a home and going through the loan process, don’t quit your day job. You’d be surprised at how often this happens. Let me tell you a quick story. I’m doing an FHA loan right now for a wonderful client. We contacted her employer to verify her income, but the employer relayed to us that she no longer worked there. Imagine the panic we had when finding out that information. We found out that she quit her new job, but started a better job with higher pay so she thought it wouldn’t be a big deal. “We had to delay the contract by about a month.” It was a big deal, and here’s why. Under FHA and VA loan guidelines, we need to have 30 days’ worth of paystubs at their new job to verify their income. Her contract was supposed to close on July 5, but now we’re going to have to delay it for a month or so. It’s causing all kinds of tension with the seller, the buyer, and their Realtors. If she would have contacted us before quitting, we would have advised her to wait about a month until the property closed to start her new job. If you’re contemplating a job change, even if it’s higher-paying, better job, try to wait until your loan is closed. If you have any questions for me or know anyone in a situation like this, don’t hesitate to reach out and give me a call or send me an email. I’d be happy to help.…
What happens when an appraisal comes up short of what a home is sold for? If the buyer has a VA loan, here’s what it looks like. Let’s say a home is sold for $250,000 to a buyer with VA financing. The mortgage company will send the appointed VA appraiser along with the contract for the property. The appraiser then goes to the property, measures it, looks at its condition, and formulates an opinion on its value. Then, the appraiser will go back and do some research to see what other, similar homes have sold for recently. This is why it’s so important for your Realtor to complete a CMA, or comparative market analysis. This will give you a great idea of what the home will appraise for before the appraiser even gets there. Both your Realtor and the appraiser use the same sold database to know what homes in the neighborhood have sold for recently. “I’ve had a short appraisal three times in the last 30 days.” If the appraiser cannot find the value that’s on the contract, he declares Tidewater. This is a VA term that states the appraiser can’t find the value of the home that’s on the contract and gives the mortgage company 48 hours to find additional comparable properties to support the contract value. Many times, this causes a great big problem. I’ve had this happen three times in the last 30 days, unfortunately. There are a few different ways with which to proceed in this, but it rarely happens. Typically, the seller will have to come down on the sale price to get the appraisal to come in. The VA buyer always has an out too and can cancel the contract if the appraisal comes up short. If you have any questions for me in the meantime about any and everything VA loans, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.…
There have been some recent changes to the USDA loan in regards to manufactured homes. Effective immediately in Texas, you can now use a USDA loan on pre-owned manufactured homes. What’s so cool about this? Well, the USDA loan is a zero down conventional loan program, meaning buyers don’t have to make a down payment. This doesn’t mean all mortgage companies will do this, however. Each company has slightly different rules, so make sure you verify with yours. “Each company has slightly different rules, so make sure you verify with yours.” To qualify for the loan in Texas, you must have a credit score of at least 620, the home must be a double wide, and it must be permanently attached to the ground or retrofitted (the foundation must meet HUD guidelines). The home must have been manufactured after January 1, 2006, and it has to be sitting where it was originally installed. A move doesn’t include the transport from the dealer or factory to where it was installed; it means moving it from one address to another. If you have any questions or need more information, feel free to reach out to me. I look forward to hearing from you soon.…
Today we’re going to talk about the difference between being pre-qualified and being pre-approved. I get this question a lot, so I figured I’d answer it for you. A pre-qualification means that a lender has pulled your credit, examined your documents, and submitted an automated online approval with Fannie Mae or Freddie Mac. A pre-approval contains all of the above, plus we submit the file to an underwriter. The underwriter looks at everything, asks for clarification, and makes a decision on whether you can afford a home or not. Once you’re pre-approved, you know exactly what you can afford. “A pre-approval might take a few days longer, but it can save you a lot of trouble.” If you’re a buyer in the market and out there making offers, a pre-approval shows sellers and their Realtors that your approval is firm and that you actually can afford the home. It’s a really important thing, especially in today’s market where multiple offers are common. A pre-approval might take a few days longer, but it can save you a lot of trouble. If you have any questions for me or need more information, don’t forget that it doesn’t cost a penny to talk. I’d love to hear from you. Just give me a call or send me an email today.…
Continuing from last time, here are the last five questions featured in our series about the 10 most frequently asked questions we receive about VA loans: 6. “Can I use my VA loan to buy raw land?” I get this question nearly every single day, and the answer is no. The VA loan does not finance the purchase of raw land all by itself. Here in Texas, we have a wonderful program called the Texas Veterans Land Board, which does finance raw land for veterans. If you’re from out of state, you’ll have to look into whether your own state has such a program. 7. “How long do I have to live in the house as my primary residence?” The VA program doesn’t really set a rule on that, but my advice to you is to stay at least 12 months in the home and fully establish your residence as your primary residence, meaning that you live, operate, and receive your mail there. 8. “Can I only use my VA loan once?” A veteran can use their VA eligibility to buy a home over and over and over, as long as the previous house has been sold or paid off. Some individuals may even be eligible to buy two houses at once. “A good point of advice is to always check with the lender you’re working with, as some lenders have additional rules they impose on VA loans.” 9. “Can I pay my own property taxes and insurance?” No—the VA always requires that your property taxes and insurance be a part of your payment. If you’re disabled and pay no property taxes, then just your homeowners insurance would be a part of your escrow. 10. “Can I get another VA loan after filing bankruptcy?” The VA is very forgiving in that matter, so the answer is yes. You will have some eligibility left, and the rules are very specific: If you had a chapter 7 complete liquidation bankruptcy, you have to wait two years from the date of the discharge of the bankruptcy. If you had a chapter 13, you need only wait 12 months before being able to qualify for another home loan. Following these questions, a good point of advice is to always check with the lender you’re working with, as some lenders have additional rules they impose on VA loans. If you have any questions, please feel free to reach out to me. I’m available seven days a week, and it doesn’t cost a penny to talk.…
Today I’m excited to launch the first half of a two-part series covering the top 10 questions I hear about VA loans. We’re going to share five of these common queries today and finish with the remaining five in our next message. 1. What kind of credit score do you need to qualify for a VA loan? Believe it or not, the VA does not set a specific threshold for credit scores. Instead, they allow affiliated lenders to set a parameter they believe to be appropriate. So if you’re curious about applying for a loan, yourself, connect with a local lender to determine whether you’ll qualify. Typically, though, the minimum limit will range between 580 and 640. 2. What kind of income counts toward qualification? Disability payments, child support, retirement income, pension, and many other sources can be applied to your application. So long as your income is steady and verifiable, it should qualify. “If you have an experienced professional to guide you, it shouldn’t be too difficult to secure a VA loan.” 3. Is it difficult to obtain a VA loan? Actually, not really. Your debt-to-income ratio will be the most important factor, but if you have an experienced professional to guide you, it shouldn’t be too difficult to secure lending. 4. Can I have a co-borrower on a VA loan? Only spouses or another person with military benefits can act as co-borrowers on a VA loan. 5. What kind of property can a VA loan be used on? Single-family homes, duplexes, triplexes, or fourplexes can all be purchased using the VA loan. You can also buy a manufactured property so long as it sits on a permanent foundation. This covers the first five of our most common VA questions. Be on the lookout for our next installment, at which point we’ll cover five more. If you have any other questions or would like more information, feel free to give us a call or send us an email.…
When there are required repairs or renovations that show up on an appraisal, they can be paid for through what is called an escrow holdback. As an example, I’m currently helping an elderly couple who don’t have the ability to make any repairs—but they do have the money needed to do so. In situations like this, we hold money back from the seller at closing to pay for any fixes that are needed. Escrow holdbacks are used for things such as roofing or flooring work; we won’t use it for room additions, foundations, kitchen upgrades, and other renovations that are unnecessary for the home. They should be done for minor, one- to two-day fixes. “We won’t use escrow holdbacks for room additions, foundations, kitchen upgrades, and other renovations that are unnecessary for the home.” Let’s say there’s $5,000 of work that needs to be done. The mortgage company will require 150% of the repair costs to be held at the title company. So in this case, the title company would hold back $7,500. Once the repairs are complete, the lender will send the appraiser to verify the work has been done. After this, the money is released to the vendor who did the work, and the remaining money is returned to the seller. Keep in mind that not all mortgage lenders will conduct escrow holdbacks, so be sure the lender you choose is willing to. If you have any questions about this process or would like some more information, feel free to give me a call at 210-215-4400. It doesn’t cost a penny to talk!…
Today we’ll be talking about the recent increase to conforming loan limits and what it means for you. The conforming limit is the maximum loan amount the government allows someone to borrow when using a conventional or VA loan. Essentially, it’s been increased because home prices have risen. For 2018, the conforming limit has been $453,100—on January 2, this limit will increase to $484,350. For someone using a VA loan, this means they can borrow up to $484,350 with no down payment. A conventional loan of this same amount can be borrowed as well, but a 5% down payment is required. “The conforming limit is the maximum loan amount the government allows someone to borrow.” Of course, you can always borrow more than this limit when using a conventional loan, but then it becomes a jumbo loan—a different topic entirely. Conforming limits on FHA loans will increase as well. Here in Texas, the limits (depending on the county) will be anywhere between $294,000 to $386,000. You’ll need to talk with your lender to figure out what the limit is for the county you’d like to buy a home in. If you have any questions or need more information, feel free to contact us. We look forward to hearing from you.…
Right now, I’m working on two separate files for unmarried couples planning on buying a home together. And with that being the case, I thought now was the perfect time to share my insight on this scenario. Is it really a good idea for an unmarried couple to purchase a home together? Actually, the answer to this isn’t black and white. It is possible for the situation to go smoothly, but I still recommend that anyone considering this arrangement starts the process by speaking with an attorney and having a simple agreement written up. This agreement doesn’t have to be elaborate, but it does need to cover both parties in the event that things go awry. Unmarried couples considering a joint home purchase should think critically about what will happen if they split up after closing, or if (God forbid) one of them passes away? Couples without the legal protection marriage provides must think critically about these and other tough questions before making the move into homeownership. An attorney will be able to guide you through such questions as you work together to draft the agreement I mentioned earlier. “Meeting with a lawyer, drawing up an agreement, and having each of your signatures notarized could save you a lot of time, money, and hassle later on.” To illustrate the importance of such an agreement, take the case of an unmarried older couple I worked with several months ago. Unfortunately, one of them passed away. And as difficult a thing as loss is to handle by itself, the scenario was made even more so by the fact that the decedent didn’t have a will. This meant his widow, who thought she owned the house completely, suddenly found herself in a partnership with her late partner’s children. Having some form of document detailing each party’s intentions is essential in protecting against scenarios like these. And death isn’t the only circumstance that could pose problems for unmarried couples who purchase a home. As I touched on already, issues may also arise if the relationship comes to an end after closing. What if, for instance, the person moving out wants to be removed from the mortgage? There are three ways this can happen: if the house is sold, the house is paid off, or the house is refinanced. If the person who decided to stay in the home does choose to refinance, however, they may struggle to qualify for a loan because they no longer have access to their partner’s income. The bottom line is this: You don’t need to be married to buy a home with your partner, but (as is always the case) both parties involved in the purchase should be in agreement as to how they should proceed if something goes wrong. Meeting with a lawyer, drawing up an agreement, and having each of your signatures notarized could save you a lot of time, money, and hassle later on. If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.…
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