VA Loan Information

February 12, 2019 By Bruce Glassinger Leave a Comment

VA Loan No Closing Costs

I’ve started the VA loan process with this lender. Now I’m finding out there are more closing cost than I expected. What do I do? Is there any way to get VA closing cost assistance? I don’t want to start the process all over but I can't afford to pay this.

This exact scenario happens far too often. One of the biggest problems is the fact that veterans don’t realize their options. There are VA loan no closing costs lenders all over the country. More often than not, the veteran is steered to expensive local mortgage brokers by realtors or even builders. The veteran goes along with it without exploring all of the options. Then the surprise sets in. Not only is the broker not experienced in VA loans, has loads of paperwork, but they charge thousands of dollars for their services.

Let's look at it from a different perspective. You're standing on shore ready to take a swim. You even have someone telling you it's ok but you can read the sign. You know there's a shark (lender) swimming around waiting to take a huge bite out of your assets. On top of it all, you have a lifeguard (no cost lender) telling you to get back to shore before it's too late. You have time to make the right decision. Making it sooner than later is what's most important

What Does “VA Loan No Closing Costs” Mean?

First, let’s be clear that there are ALWAYS closing costs involved with any mortgage. There will be title fees, appraisal, prepaid interest, escrow and as you may have found, lender fees. What “No closing cost” means is you don’t have to pay closing costs for your VA loan. How?

Lender Paid VA Closing Costs

There are many ways to get VA closing cost assistance but one of the most popular ways to get a VA loan with no closing cost is Lender Paid assistance. Due to the fact that there are HUGE profits in VA loans, a lender can very well credit you for ALL of the costs you would normally pay at closing. This can easily be $5,000 to upwards of $25,000 of VA closing costs depending on the state, the loan amount and of course the lender. Some lenders don’t charge any origination fees. So the total closing cost could be reduced by $2,000 to as much as $20,000, depending on the loan amount and if the lender is charging discount points.

But I Don’t Want to Start the Process All Over

More often than not, this statement is coming from the assumption that the process will be as long and as tedious as it has been so far with the current lender. This couldn’t be further from the truth. In most cases it literally is only a matter of minutes to gather the documents that have already been gathered together. The rest of the process is pretty well finished. In fact, the appraisal, termite, title are all transferable. A simple verification of employment and income and you’re done.

Find the Best VA Lender for you

Before spending thousands of dollars on closing costs, check out your options. Even if you have 2 weeks until closing, you can still close on time with a VA Loan No Closing Costs Lender.

January 18, 2019 By Bruce Glassinger

How Quickly can a VA Loan Close?

You’re at that point where you're wanting to get approved for a VA loan or maybe you’re in the process and wondering, “How quickly can a VA loan close?” The simple answer is, you can close a VA loan in less than 2 weeks. However, it’s not as simple as that. There are a few factors that can affect the time it takes to close a VA loan. Are you in the middle of the process and wanting to switch lenders? How big is the lender you’re thinking about using? Is it a Bank, mortgage company or broker? Do you have a VA appraisal and if not, what is the VA appraisal turn times in your state? I’ll touch on each of these briefly here.

Factors that Affect How Quickly a VA Loan can Close

Appraisal

VA gives appraisers anywhere from 7 to 14 business days in most states. So you can see where in some states it can take up to 10 full days with holidays and weekends included. Yet others it could be nearly 3 weeks before you receive the appraisal. If you’re in Alaska or Montana, expect it to take close to a month or more. Find your VA appraisal turn times here.

If you feel you need to switch lenders for any reason, you will not need a new appraisal if you have one already. The appraisal you currently have goes with you to your new lender. Now you can see right away where this can cut down weeks. Find a lender that can approve your VA loan in 3 days or less, and you won’t have a problem closing in less than 2 weeks.

Slow Lenders

Veterans and service members have been lead to believe a VA loan takes 40 to 60 days to close. Well, for some lenders it does. However, it couldn’t be further from the truth. I’ve had VA loans close in less than 2 weeks when the veteran has made the switch.

So why does it take nearly 2 months to close a VA loan for some lenders?

Having originated VA loans since 2002 for over a half dozen lenders including brokers, mortgage companies and banks, I can say there are countless reasons why it could take so long to close a VA loan. True story – one lender that wasn’t an actual bank ran out of credit line before the end of the month. All loan closings had to be delayed until the loans were sold and credit line paid back.

That’s an extreme situation though and one you probably won’t ever run into. Here are the top 3 reasons a VA loan can take 40 to 60 days to close with some lenders:

1. Bottlenecks
2. Volume
3. Brokers

1. Bottlenecks

Quite often the process has bottlenecks the lender hasn’t worked out. The more bottlenecks there are, the slower the line goes of course. The more loans that pile up, the greater the delays.

2. Volume

Advertising can do a lot for business. Obviously the more a lender advertises online, on television or on the radio, the more business they will get. If they haven’t prepared their process for the influx of business, you start to experience bottlenecks. These are points in the process that cause delays. When multiple loan files have to touch one person and suddenly, the number of files that reach that person doubles, you can imagine what that does for every other file that follows. Everything stacks up. So if you see a lender all over the internet or television, get ready for a long ride. Also, off topic, watch out for closing costs. Someone has to pay for the advertising.

3. Brokers

Brokers have a great purpose in helping veterans. They have lenders that provide loans to veterans with credit profiles other lenders might not approve. In these cases, veterans should expect their loans to take a little longer as there are more details and paperwork to tend to on damaged credit loans.

Yet why would a broker take longer to close a good credit VA loan versus a bank? The answer is, they send their loans off to big volume lenders to underwrite. These single lenders underwrite for thousands of brokers every month. Volume plus bottlenecks equals 60 days easy.

If you’re wanting to close a VA loan in less than 30 days, it can be done. You may not know if there are bottlenecks in the process but if you pay close attention to how much advertising the lender does or if it’s a broker or bank, you’ll have a better idea.

Also check out:
VA Closing Costs
VA Closing Costs Assistance
No Cost VA loan

January 18, 2019 By Bruce Glassinger

Closing Costs Assistance Program

In a previous article I explained the 3 ways to get VA closing cost assistance. Of course assistance can come in many forms from lender assistance to realtor and seller assistance. You may even have opportunities to get government assistance through grants, which I will go over later. Here I’ll discuss another, more specific form of VA closing costs assistance that is helping millions of veterans nationwide. It’s called the Closing Costs Assistance Program. Below I’ll go over some of the more general points to the program but recommend you consult a VA Loan Specialist that can better assist you with your exact situation and qualifications.

Who Qualifies for the Closing Cost Assistance Program?

The Closing Cost Assistance program is not only for veterans and military personnel qualifying for VA loans. First time home buyers or First Responders may qualify for the program and use it for closing costs or even down payments. It can also be used for conventional, FHA and even USDA loans. This is especially beneficial for veterans that for one reason or another, don’t qualify for a VA loan or don’t meet the VA eligibility requirements.

Income Qualifying

Often times when you hear “income qualifying”, you might think it means “earning enough to qualify”. In the case of the Closing Costs Assistance Program, it’s just the opposite. You can’t exceed a specific yearly income. This program is reserved for low to moderate income borrowers only. Because the requirements are specific to each geographic location, you will need to consult a Loan Officer to discuss your specific income requirements.

How much Closing Cost Assistance can I get?

The program allows from $5,000 for first time home buyers up to $10,000 for qualified veterans. Again, this can be used for closing cost assistance or as mentioned before, down payment assistance.

$7,500 VA Closing Cost Assistance: If you currently serve or have served in any branch of the U.S. military but not called to action in an overseas conflict, you may qualify for up to $7,500 in VA closing costs assistance.

$10,000 VA Closing Cost Assistance: If you currently serve or have served in the U.S. Military and called to duty in an overseas conflict, you can qualify for up to $10,000 in VA closing costs assistance.

Find a Lender that offers VA Closing Costs Assistance

If you are interested in getting VA closing costs assistance, there are a couple key points to consider. One, not every lender has access to the Closing Cost Assistance Program. Although you can switch lenders midway through the process and can easily close on time, it’s always more beneficial to start off on the right foot. The second point is to choose a lender with absolutely no lender fees, origination fees or broker fees. It will benefit you in the end.

NOTE:

If you are working with another lender, you can get the assistance with a new lender and have your loan closed on time. You will just need to ask what the lender’s turn time is on approvals. I would recommend staying away from larger lenders and brokers if you do make the switch. Larger lenders have higher volume and cannot give you the personal assistance and brokers aren’t in control of the underwriting and as well, ship your file off to high volume lenders to underwrite. So you would end up in the same boat.

January 12, 2019 By Bruce Glassinger

Jumbo VA Loan – Maximizing Benefits

Let’s talk a little bit about maximizing your benefits with a Jumbo VA loan. This has become a much more widely used product over the years. Veterans have realized how superior this loan is to other jumbo loan products. The less restrictive loan amounts and lower down payment requirements give veterans greater spending power. Whether it be to purchase a nicer home suitable for you and your family or have access to more equity for reasons such as investing or debt consolidation, the VA jumbo loan can be an amazing tool for veterans.

However, there are some things to consider before moving forward with any jumbo VA loan. It’s not always a walk in the park for every veteran. The lender you choose can have a major impact on if and how much you can get approved for.

VA Lender Restrictions

Even though VA doesn’t have many restrictions regarding VA jumbo loans other than the VA county loan limits, the lenders do. Some lenders restrict veterans to 50% debt to income ratios while others may limit the loan amounts to the VA county loan limits. In both of these cases, the veteran would be limited to how much he or she can borrow. This could be the difference in getting the home you want or having to settle for something less.

This is why it’s extremely important to find just the right lender that won’t limit you. In addition to this, you absolutely want to find a VA lender that doesn’t charge lender or origination fees. With the loan amounts much higher, and quite a few lenders adding in a 1% origination fee, you can see how that would make a jumbo VA loan a more expensive alternative than it would normally.

December 3, 2018 By Bruce Glassinger

Apply for a VA Loan Online

You might be wondering if or how you can apply for a VA loan online. Maybe your local lenders are charging too much or rates seem too high. More than likely, you've found they don't seem to be as knowledgeable in VA loans as you would like. There are many reasons you would want to search the internet for your next VA loan. There are also some things to look out for as well. Here I will go over some benefits as well as pitfalls to applying for your new VA loan online.

Applying for a VA Loan Online - Watch Out

There are only a few things to look out for when searching for a VA loan online. I'm starting here because although the list is short, it can have a major impact on the entire process. Tread very lightly when doing your search. You should be even more weary when filling out applications that ask for social security numbers before you actually speak to a VA Loan Specialist.

Overwhelming Response

Often times when filling out applications online, the home loan shopper doesn't take time to read the fine print. If you don't know or at least have some indication how many lenders will respond to your request, you could be in for a treat. You see the commercials. When lenders compete, yada, yada. What you don't know is that more than 4 lenders respond to these online applications. In some cases, you can get up to 12 or more lenders calling you.

VA Loan Lending never collects your social security number and only distributes your request to one lender. You will never receive harassing phone calls. In most cases only one call will be made so be sure to call back if you're wanting to cut your costs on your next VA loan.

Loan comparison sites make their money from selling your information to lenders. Of course, the more lenders they sell to the more they make. Add to the fact, sites that ask for your Social Security number generally pull your credit. Once that credit is pulled, other lenders with access to "credit pull alerts" now are aware you're shopping for a mortgage. Like cockroaches when the lights go out, these lenders seem to come from everywhere and can be hard to get rid of.

Be sure to get your quotes first before getting your credit pulled. Ask for their fees, their rate, if any points are required for that rate, the payment and the loan amount they are using for the quote. A fee sheet or Loan Estimate isn't required at this point. A lender asking for it before providing one themselves is one to watch out for.

Benefits to Applying for a VA Loan Online

Lower Rates

This is an obvious reason but maybe you don't know why you would get a lower rate shopping online versus a local lender. Think about it this way... You go to your local department store to purchase a new watch but you swear when you were doing research, you saw the exact same watch for MUCH less on a major shopping website (I won't mention any names but it rhymes with Glamazon). This same concept applies to online mortgage shopping.

A local lender has to pay the bills just like a nationwide lender but does in most cases, 1/10th the business. So how do they make a profit? You guessed it! They have to charge more fees and higher rates.

Lower Costs

Sure, being able to see a pretty face across a desk may seem appealing but is it really worth, sometimes, thousands of dollars to get that luxury? In almost every case, an online VA lender will charge at least hundreds of dollars less than a local broker. In some cases, a Federally Chartered VA Bank can cut off literally THOUSANDS of dollars either by not charging or by paying for your costs for you. Watch out though. There are a couple big online VA lenders charge quite a bit. Again, make sure to get the quote before they pull your credit. This will save you quite a bit of time.

Get a No Fee Quote

Quicker Approvals

There are times when you just want the loan and don't want to wait months and jump through hoop after hoop for an approval...okay, maybe every time. Here's the deal. Local brokers generally do not specialize in VA loans and as I mentioned earlier, don't do as much business as nationwide lenders. A VA loan is a very specific type of loan that has very specific guidelines. In addition, the appraisal process is much lengthier than a conventional loan. This could very easily end up in delays later in the process when it's simply too late to switch lenders.

When you apply for a VA loan online, a Federal Bank is generally your best choice. You'll get quicker approval and closing times due to a more well set and streamlined process. In addition, the volume of loans originated translates to discounts off of title fees as well as not having to charge fees themselves.