OT Homeowners

I'm going to be going through the process of pre-qualifying for a home loan. I'm a first-time buyer and I'll be using my VA Home Loan benefits to do it.

How many of you are homeowners? Was home purchasing process relatively smooth for your or was it like pulling teeth?

I built a home which may have been different, but yeah it's a hell of a lot of paperwork. The most difficult part for me was getting everyone on the same schedule, because you have the land to level, utilities to be laid, and foundation to pour before the house even starts getting erected. Those are all different people and different agencies.

Then you have to halt construction at certain points until an inspector can show up. It's a lot of batting-the-shit-around.

Don't end up in a trailer plageus

It's like pulling teeth, and then when you think they're done, they find a whole new set of teeth to pull.

It's relatively painless if you have good credit, don't use the FSBO route, and CYA. I've seen people cheap out on things like home inspections which.... yeah, don't do that.

This, also don't cheap out on the appraiser, the guy who sold me my place did that and almost was screwed when he was assigned somebody who had lost their licence. Luckily they caught that.

@br0kenrabbit: My parents parents had their home built and I remember it being a nightmare. I'll be buying a previously owned home. Some that we're looking at were built around 2003-2006.

@GazaAli Yeah I don't plan on it.

@mattbbpl I have pretty decent credit and I make a decent salary. I won't be cheap out on inspections. The cool thing about the VA Home Loan program is that they will sound out someone to appraise the home to make sure I'm not over paying for the home or if the house is even worth buying. It's not an inspection, just another opinion.

Oh, right, I kind of glossed over the VA thing.

The VA program is a bit of a double edged sword. It also tends to have the effect of eliminating houses as options for pretty silly reasons. That may end up being the most trouble you run into.

lol what VA home loan benefits?

I'm a veteran as well and VA didn't do shit for me when I purchased my first house. Veteran status got me more traction with commercial entities like USAA, Navy Fed, or PenFed than Federal programs.

You can get a VA loan which require no money down and you don't have to pay mortgage insurance. They typically can get better apr rates and are easier to qualify for if your credit is less than favorable.

You still need to go through an application process. And unlike what you seem to be suggesting it's not a magic pill that will suddenly hide your shitty credit from lenders. If you can't get the banks to give you a loan then you are not going to be able to convince them to give you one with no downpayment or mortgage insurance VA guarantee or not. Again in my experience, VA loan doesn't do shit and banks couldn't care less about your VA loan guarantee.

Interesting. Five of my veteran buddies have used their VA Home Loan benefits and its worked great for them. So tell me what exactly the VA Home Loan DIDN'T do for you? I have pretty good credit and two banks I've spoken to got juicy over me mentioning the VA Loan.

The only issue I had with VA is when I wanted to buy a condo but for some reason the VA is very picky about what condo they will loan on... I have good credit though so couldn't really tell you if it's actually good on that side, that's what they claim though.

I might ask the opposite. What exactly did the VA guarantee do for you? How exactly did the offer change when they learned you had the VA guaranty versus when they thought you didn't? My credit score is in the 750s range and when I brought my first home, the loan agent at Navy Fed told me it didn't make a difference whether I had a VA certificate or not. I went to another bank and was told essentially the same.

You guys keep referring to it as an VA loan but as far as I understand it, that's not technically correct. VA isn't your lender, another bank is. VA just runs the program that partners with banks to get their members loan. Again my point is the program isn't a magical instant approved no downpay solution you guys are making it out to be. If you do the leg work you can probably find a better deal outside of the VA list of partnered banks.

I might be a little biased as I'm of the opinion that all VA ran programs are bureaucratic messes. Sure there are those people who benefited by gaming that system but it does not inherently serve veterans at the same level or for those who really deserve it. [/rant]

You are correct. The VA does not actually loan you the money. However, what makes it tasty for banks and what gives you a zero down payment option and low interest rate is that if you for some reason cannot pay your mortgage, the VA will pay the bank a certain amount of money. So in this case, not only does the bank get to take your home back and re sell it, they also get a decent check from the VA as well. In my case, its $38,000.

We owned our house outright then decided to down size. The couple buying our house were going through the VA for their loan and it was ridiculous the things that they required to be "fixed" in order to approve the loan. We did them and it didn't cost much as it was a railing here or a fitting on a fixture there. When I bought my current home though as it was a cash purchase with no loan it was very easy and just a waiting game really for paperwork.

I don't claim to know how the program works exactly, all I'm saying is from what I experienced; the loan agents didn't seem to care whether I enroll in the VA program or not. Also common sense tells me VA wouldn't insure someone whom the bank doesn't trust, veteran status or not.

@bmanva: The VA will insure anyone who the bank will give a loan to, the banks are willing to be more lax on their requirement because the VA will insure the loan.

VA insure depends on bank loan, bank loan requirement depends on whether VA will insure. Isn't that circular logic?

@bmanva: No. Any veteran who can get a bank loan can use their VA benefit, If the bank knows the VA will insure your loan they are going to be bit more forgiving is all... not really circular.

VA Home Loan Guarantee depends on military record and stable income.

A bank loan for a home purchase with VA backing usually have lower rates and no money down (sometimes as high as 20% for conventional home loans).

That's the way I see it.

UPDATE:

So I went with the VA Loan and was pre-approved by the lender. My girlfriend and I picked out a house, made an offer and the seller has agreed to it. The inspection and appraisal are scheduled. If all goes well I should be able to close by the middle of July.

Its a decent place: 3 bedroom, 3 bathroom, two stories, garage, dark hardwood flooring, comes with all the appliances, bar attached to the kitchen, a fenced in yard that wraps around to the side of the house, etc. Built in 2006.

I've started the home hunting process as well. I plan to purchase a home within 5-8 months. It'll be my first home as well so I'm not looking for anything special. I'm definitely in the very early stages right now. Picking a realtor, budget and general location is kind of my first steps. I have very good credit so I'm hoping for a relatively easy process.

Awesome. I would suggest getting pre-approved by a lender first so that you have something in writing. Then when you go around looking for a home or realtor, you'll have some figures to throw out.

Yea, that's on the to do list as well. Homes in my city are relatively affordable. I'll probably purchase one in the 60-80k range which I know I'll easily be approved for. Good credit score, reliable lender, and decent income makes me a very desirable borrower!

Wow! Where do you live? Having a good credit and good income really help. Are you planning on a conventional loan? FHA?

Wichita KS. 2-3 bedroom homes run anywhere between 50-80k on average so buying a home is a really affordable option. For me an FHA loan is probably the best option. Putting 10-15k upfront for a conventional fixed (before calculating closing costs) would be pretty difficult financially. With an average down payment of 3.5% on an FHA, closing costs would be a far more manageable figure.

Excellent. Yeah that does seem pretty affordable. I live up here near Portland, Oregon. The home I'm buying is 212k. Since I'm using the VA Loan, I don't have to put anything down, but there is a VA funding fee of about $4500. That is getting figured into my loan though. As far as closing costs, my offer included the seller paying 3k of the pre-paids and closing costs. The lender credit I'm getting and my earnest money deposit are also going towards it. So at closing, I don't have to bring anything and I'll be getting a few hundred back.

bought new in 2007 ( terrible timing in terms of the housing market )

the process was fairly smooth for my wife and i and we were about to refinance a few years ago through HARP to get a better rate and avoid paying PMI so we're saving a lot of money each month now

only downside is our lender requires tax escrow so we're basically paying an estimated piece of our property taxes each month. i'd rather just save the money myself and pay the tax bills when they're due

I bought a house 16 years ago. the more down payment money the better, less monthly payments this way.. I'm happy to have a house but then it's pointless living by myself. sometimes I just wanna sell it.

I kinda want to get a cheap trailer sometimes.. I usually stay in my bedroom anyway.

That's basically how Ill be doing it. The actual mortgage is cheaper than the rent I'm paying now. With the added property taxes and home insurance, Ill be paying about 150 dollars more a month than I do right now for rent. I'm alright with that.