VA Loan for Soldier close to ETS

2015-01-06T16:39:48-05:00

I have a soldier that is due to pcs in about a year and a half. He's really wanting to purchase a home in TX when he gets out. ACS here didn't really help him too much and honestly I don't have much knowledge on VA loans. Any advice?

Response by 1SG(P) Private RallyPoint Member made Jan 6 at 2015 4:55 PM

2015-01-06T16:55:53-05:00

http://www.benefits.va.gov/homeloans/.

Response by Elizabeth Malkin made Jan 6 at 2015 4:57 PM

2015-01-06T16:57:03-05:00

SGT(P) Daniel McBride, that is a great question! RallyPoint has recently partnered with a company that we think stands above the others to help our members get VA loans. The company is run and largely staffed by vets, people who have lived through the same experiences and now understand the system inside and out. They have a great success rate of helping members find VA loans.

Check out their RallyPoint page here: https://www.rallypoint.com/resources/va_loan_captain

RallyPoint - The Professional Military Network

- no money down; - reduced closing costs; - relaxed qualifying; and - lower monthly payments.

Response by PFC Jim Mills made Jan 6 at 2015 5:50 PM

2015-01-06T17:50:59-05:00

Well he should go on ebenafits and get his loan guarantee paperwork and start pre-qualifying because now is a great time to buy also tell him to get all his medical paperwork if any just incase he was ever hurt in line of duty for a future va claim!! Hope this helps any other questions don't hesitate to ask

Response by SSG Private RallyPoint Member made Jan 6 at 2015 8:44 PM

2015-01-06T20:44:25-05:00

Things to consider about a VA loan;

1. Determine your DTI - debt-to-income ratio. A low debt-to-income ratio is 20% or less. A high debt-to-income ratio is anything over 40%. Different mortgage programs enforce different debt-to-income cut-offs but evaluating an applicant's DTI is nearly always considered the keystone of a sound underwriting process. The VA mortgage guidelines state that 41% is the maximum debt-to-income ratio for a military/Veteran mortgage borrower.

2. Residual Income - Unlike DTI, this calculation goes one step further and factors in other expenses like childcare, estimated utilities, car payments, child support (if any), and Social Security and income taxes, other debts. This calculation attempts to determine, or at least estimate, all your real-life expenses each month. Residual income is calculated by subtracting all these expenses from your gross monthly income to include what your monthly mortgage payment may be. What is left over is residual income after EVERYTHING has been paid and it's enough to live on for the remainder of the month. Every region has a certain amounts of residual income requirements.

Heres a cheat sheet: https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=va%20residual%20income%20calculator

3. Funding Fee Waiver - Public Law 112-154, the Honoring America's Veterans and Caring for Camp Lejeune Families Act of 2012, meant a great many changes to the VA loans program in 2012. One of those changes includes expanding the criteria for VA loan funding fee exemptions, and as a result, the VA has changed the way it evaluates applications for those funding fee waivers.

"VA already had the authority to waive the funding fee for active duty Servicemembers who close a loan based on a pre-discharge examination and rating. The law now permits a waiver based on a pre-discharge review of existing medical evidence (for example, service medical and treatment records), that results in issuance of a memorandum rating by VA. This accommodates those Servicemembers who, for whatever reason, cannot undergo a full examination, but for whom existing medical records demonstrate they will be entitled to VA compensation upon discharge from active duty. Lenders are reminded to ask any active duty loan applicant early in the loan process if he/she filed a claim for VA compensation while on active duty. If the response is `yes', the lender must send VA Form 26-8937, Verification of Benefits, to VA for review. VA will then request a memorandum rating to determine if the Servicemember will receive compensation upon discharge. Once that determination has been made, VA Form 26- 8937 will be returned to the lender, noting the Servicmember is exempt from the funding fee." Borrowers and homeowners with a disability rating of at least 10 percent are exempt from paying the VA Funding Fee.

http://www.benefits.va.gov/WARMS/docs/admin26/handbook/ChapterLendersHanbookChapter8.pdf
http://www.benefits.va.gov/homeloans/documents/circulars/26_12_9.pdf

4. As someone mentioned get all copies of your medical/dental records. You can submit for VA fully developed claim (FDC) 180 days before separation. I strongly recommend that you contact a Veterans Service Officer(VSO) to assist and any questions about the claims process. have a VSO be your advocate as stated by PO1 Private RallyPoint Member, do not do this alone.

By all means use the link suggested by Elizabeth Malkin, great stuff there. Ok there is where my 3 cents worth of contribution ends. Best of luck to your Soldier

Response by Sgt Melinda Enfinger made Jan 7 at 2015 12:21 PM

2015-01-07T12:21:49-05:00

The process is fairly simple IF the lender and real estate agent understand the VA Home Loan Benefit program. Unfortunately, many if not most, do not understand it and often times agents and even lenders steer buyers away from VA Loans and towards conventional or FHA loans.

This has a lot to do with the misperception that a VA Loan makes the process harder, that the appraisals always require that ALL repairs must be completed prior to closing (not true), and that the seller's are required to pay an inordinate amount of closing costs for the buyers (also not true).

Texas is also the ONLY state that has a veteran's land program where you can purchase land with lower down payment and interest rate even for purposes other than building a home. Disabled veterans are also eligible for property tax exemptions which can be a huge savings for them. These exemptions are not automatic and many agents don't know about them in order to inform the veteran to apply. The Texas Veteran's Land Board is separate from the VA benefits and different from the standard VA loan, so make sure your agent knows what's up.

Oh, and if he's in the market for a luxury home (over $500K), he can still use a VA loan and get the first $417,000 with no downpayment. Most veterans don't even realize this and think they have to buy something less than the $417K.

I have an extensive real estate background specializing in the veteran community, but I AM NOT an active real estate agent, so I'm not trying to "get your business". If you would like additional information, I would be happy to provide it to you and I can also connect you with an agent who understands the program. (Because I am not an active agent I do not receive a referral fee.)