Allen Wilkerson

 

VA Home Loans

Quick Reference Sheet

Major Benefits of the Program

For veterans, the VA Home Loan provides no-down-payment financing backed by the full faith and credit of the Federal Government. For you, the realtor, the VA Home Loan program offers the opportunity to expand your customer base. In nearly all cases, lenders use the same automated underwriting systems for VA loans that they use for conventional loans. That means there’s no waiting for VA approval, so your VA loans close as fast as conventional products! Veterans and lenders have rated their satisfaction with our program at over 90%, and we hope that realtors nationwide will join the many satisfied program participants who do business with VA.

 America’s Veterans

As of September 2006, there were an estimated 23,976,991 veterans in the United States. Here are the top ten states in terms of veteran population:

 State Veteran Population

California 2,203,727

Florida 1,747,076

Texas 1,652,214

New York 1,094,391

Pennsylvania 1,088,220

Ohio 1,012,466

Illinois 852,409

Michigan 804,011

Georgia 757,070

North Carolina 756,216

Those aren’t the only states with large veteran populations—Virginia, Washington, Arizona, New Jersey, Missouri, Indiana, and Tennessee are estimated to each have over half a million veterans within their borders.

Veterans obtaining VA loans have a median FICO score of 680, and VA’s delinquency rate dropped 3.1% from second quarter 2006 to second quarter 2007. During that same time period, delinquencies jumped 19.2% for prime loans, 26.7 % for subprime loans, and 1% for FHA loans. Plus, with multiple products available—from 30-year fixed to hybrid adjustable-rate mortgages—there’s sure to be a loan to suit the veterans in your state.

Frequently Asked Questions

What is the maximum loan amount VA will guarantee?

VA does not have a maximum loan amount. It is understood that lenders must generally have at least 25% of the loan guaranteed by VA to sell the loan on the secondary market. Based on this factor the following limits may apply:

* It is suggested that any deviations on loan amounts for purchases or construction and regular or cash-out refinances listed above be discussed with your secondary mortgage market representative prior to closing to ensure that you have the proper coverage needed to satisfy your investors requirements.

 Can a veteran purchase a home with their fiancé/fiancée using a VA loan?

The veteran can purchase a home with any individual they choose, however; VA will only guarantee the portion of the loan attributed to the veteran and a spouse. For example, if the veteran intends to purchase a home with a fiancée prior to marriage and will share the same interest in the property, VA would guarantee half of the loan.

What is the maximum guaranty on a joint loan for two veterans?

The use of two certificates does not mean you can double the guaranty or loan amount. As with a non-joint loan, potential maximum guaranty on a joint loan is calculated based on the total loan amount and cannot exceed $104,250 even if the available entitlement of the veterans involved adds up to a greater amount.

Is an off base housing authorization required for veterans currently serving in the Armed Forces to process a loan package?

DD Form 1747 is no longer required.

Will the VA accept a partial package for credit approval prior to the appraisal being ordered?

No. The VA requires a complete loan package to underwrite a loan for commitment. A complete list of required package content is contained in Chapter 5.4 in the VA Lender's Handbook on pages 5-8 and 5-9.

How many properties can a veteran own through VA?

A veteran can reuse the VA benefit multiple times as long as there is sufficient entitlement to cover the new loan. In addition, the new home purchased must be the primary residence.

Can a veteran refinance over the 90% LTV on a cash-out refinance?

The loan amount may not exceed 90% of the appraised value (referred to as the base loan amount) plus the VA funding fee, plus the cost of any energy efficiency improvements up to $6,000.

How do you process a loan for a veteran who has been rated incompetent?

Obtain proof that the person signing the documents for the veteran is authorized. Obtain VA Form 26-8937, Verification of VA Benefits. Submit a complete package (including a NOV) to VA for underwriting prior to the closing.

Where can I find information about lender approval, automatic authority or agents?