Need some info on VA Mortgage

[PimpJuice]

Looking at buying a house in the next 6 months. Can anyone suggest a loan provider of VA mortgages that they had a good experience with?

Are there any significant negatives to consider by going with a VA mortgage?

Thanks,

Schwetty

 

[Hugh Johnson]

Navy Federal Credit Union, USAA. The only negative IMO is you have to sell to a service member with VA eligibility to get your eligibility back. I have no idea why.

 

[PimpJuice]

Navy Federal Credit Union, USAA. The only negative IMO is you have to sell to a service member with VA eligibility to get your eligibility back. I have no idea why.

In other words, if you sell your house to Joe Blow, you essentially lose eligibililty forever?

That's probably not a huge deal to me but seems like a dumb policy.

Any bennies on the interest rate or other fees?

 

[propilot]

Make sure you do your homework. I bought a new home in March and after comparing VA to conventional, went with conventional. Fees and interest rates were lower...

 

[CatfishVT9]

That's only if you let someone assume the mortgage. If they get a new loan, your "liability and eligibility" is freed up. Interest rates are the same at NFCU.

 

[dispatchguy]

For me, the nice thing about having a VA loan was not having to pay any closing costs; we left our closing with the keys, our lives signed away, and around 3500 or 4000 in free unplanned cash; wide screen TV and a stainless steel fridge and a stainless steel stove...

Another nice thing about going with a VA loan was that the VA will not let you get mixed up with the variable rate crap shoot, the interest only crap shoot, or anything else like that.

Another nice thing was that the VA will not let you sign a mortgage for a dump; they mandated a home inspection prior to closing.

I would do it again, if we ever decide we have to move..

 

[CatfishVT9]

Here's an additional bennie I just found out about. If this is your second or subsequent VA loan, you have to come up with a 3% "funding fee". I had just applied for a conventional refinance and it looked like I might not get the numbers I needed since I will roll in an equity loan. Paying that off is "cash out" and they only loan (conventional) 75% of the appraised value. The NFCU loan officer asked if I was receiving disability (which I thought was odd) then he explained that if you have 10% or more disability, they waive the funding fee. On a 300k loan, that's a 10 grand savings! Sign me up!

And if I recall correctly, VA still will finance 100% of the appraised value.

Pimp Juice, if you've flown Hummers and lived on a Carrier, your hearing probably qualifies you.:beer:

 

[rice]

VA will also reduce the funding fee if you put an additional 5% down. Conventional loans typically require 20% down and have a max debt to income ratio of about 28% if you have FICO scores at or above 740. The VA will allow you to go as high as 41% debt to income with no money down (up to the max of $417k depending upon your state & county) and they will work with FICO scores as low as 650.

 

[T-1GUY]

I can't say enough good things about Penfed.org I refinanced with them about six months ago and got a 20 year fixed rate @ 4.5% with no origination fee and 1/2 a point. Their closing costs were pretty much non-existent, they cover almost everything, unlike my original VA Loan where I got hammered with the 3% fee and several thousand in closing costs. The only thing a VA loan has over a conventional right now is the ability to avoid PMI with 100% financing. If you can put down 20%, I would go conventional... Just my 2 cents...

 

[FNG24]

Pen Fed Origination

T-1,
Will they wave the origination fee. I called them today after seeing your post and they wanted 6k origination fee on a 270k refi. WTF over? Thanks for the gouge.

 

[Vandal]

Great thing about the VA is you can put zero money down and not have to pay PMI (Private Mortgage Insurance). The catch is you have to pay a funding fee which varies based on your status (active duty/reserves/etc) and also whether you have used your homebuyer benefit before. You can roll the funding fee into your loan so you don't have to pay extra closing costs.

Bottom line, the VA is an amazing deal right now because with interest rates around 4-5% it's silly to put 20% into a downpayment when you could use it towards other more profitable investments. My 2c.

 

[T-1GUY]

The rates I quoted were applying online at Penfed.org. I have never seen an orgination fee there higher than 1% of the loan.

 

[stupidpilot]

Navy Federal Credit Union, USAA. The only negative IMO is you have to sell to a service member with VA eligibility to get your eligibility back. I have no idea why.

That is not true at all. I sold to a regular civilian and got my eligibility back.

 

[transpac]

That is not true at all. I sold to a regular civilian and got my eligibility back.

I believe the quoted post concerned a buyer that assumed an existing VA loan. If the loan was paid off when it was sold VA loan eligibility is re-established. If a VA loan is assumed by a civilian it's based on the previous owner's VA loan eligibility.

 

[IdRtherBsailing]

I agree with other posts, you don't lose eligibility unless you let a non qualified borrower assume the mortgage. If a qualified veteran assumes the mortgage, he can lock in your interest rate and as long as he qualifies as a vet you can get your eligibility back. If you sell it to a civilian its yours because the VA isn't backing a conventional mortgage. I am on my second VA loan and I agree there are many positives. No down payment, no PMI are the big ones. They have a streamline re-fi deal that is pretty good. Up until recently if the rates come down its just drawing up papers and closing. They never even needed an appraisal or even a credit/job check. Just as long as you were making your payments you were good to go. I hear its still good buy they may require an appraisal now.

Some cons are: The funding fee's. I believe the first purchase is relatively low, 1.5% or so if you were active duty or activated. It goes up after that, so depending on how much the house costs, you may be better off with conventional. Also the VA sends in their own appraiser and can deny the loan for a lot of silly reasons. An example is unfinished projects. I had a friend who was denied because the house he was looking at was only 1 year old, but the walls in the garage were formed up for drywall. The unfinished walls put the kybosh on the deal. Our first place had some peeling paint on one side. We arranged to have it painted and then it was approved. So no fixer uppers for the most part. Also a while back the underwriting was a pain in the a$$. We closed the day after closing because there were 3 underwriters for the entire system, and that was with a 120 day notice. They have a much better system now, it's automated for the most part.

Overall a good deal though and you can apply for a VA loan through any decent mortgage broker.

 

[skyward80]

Last time I checked, USAA wasn't doing VA Loans. (Yeah, that surprised me too.) That bummed me out because they have great customer service and all my other stuff is with them.

I decided to go with CitiBank. I refinanced my student loans with them a few years ago. GREAT customer service and very military friendly. If I can't do business with USAA, I will pick them time and again.

Take it from me... AVOID WELLS FARGO. I've had bad experiences with them, and I've had family members and friends who've had bad experiences with them. In fact, the experiences were so bad, that I would rather pay a higher interest rate to another bank than do business with Wells Fargo ever again.

Did I mention you should AVOID WELLS FARGO?

Skyward80

 

[c17guy]

Last time I checked, USAA wasn't doing VA Loans. (Yeah, that surprised me too.) That bummed me out because they have great customer service and all my other stuff is with them.

I decided to go with CitiBank. I refinanced my student loans with them a few years ago. GREAT customer service and very military friendly. If I can't do business with USAA, I will pick them time and again.

Take it from me... AVOID WELLS FARGO. I've had bad experiences with them, and I've had family members and friends who've had bad experiences with them. In fact, the experiences were so bad, that I would rather pay a higher interest rate to another bank than do business with Wells Fargo ever again.

Did I mention you should AVOID WELLS FARGO?

Skyward80

I got a VA preapproval letter from USAA today. Not sure how long ago you checked...

 

[instructordude]

If you are an inactive member of the Civil Air Patrol can you get approved for a VA Loan??

 

[Oh-ryan]

If you are an inactive member of the Civil Air Patrol can you get approved for a VA Loan??

Come on ID. I expect better. You're not gonna get any bites with this kind of junk. Step your game up.

 

[Weasel Keeper]

I'm on my second VA mortgage and both are with Wells Fargo. No, I'm not promoting WF, but they've done okay by me so far. Actually the first VA loan was with WF (Norwest before WF bought them), the second was with a local bank who sold it to WF.

The biggest downfall for me was the usual gov't "hurry up and wait" crap! The first mortgage had an inspector who wrote the piss out of the house I was buying. All and all it was for the best and got it up to current code before I bought it though. My current loan, I was supposed to close around Halloween last year. After the VA kept coming back with petty things to do with inspections and paperwork I didn't close until Christmas eve 08! An example of petty red tape...I thought ahead and since it's a country house I ordered a water/well inspection from the state. The VA came back a few weeks later and said I HAD to have a COUNTY water inspection. Now wait a second...I had a STATE inspector! A few weeks later the VA came back and said my state inspector was okay since my county didn't have a water inspector. DOH! Hurry up and wait.

I think if I didn't still "own" my last house (hasn't sold yet) I would have gone FHA with 3% down. Could have saved a point (VA's interest rate is 1 point higher than non-VA). Silly rules say I can't have two FHAs at the same time..heh.