VA Guaranteed Home Loans. Roanoke VA Regional Loan Center Compliments of Roanoke and Cleveland RLC. Contact Information. National VA website: www.homeloans.va.gov Roanoke VA website: http://www.vba.va.gov/ro/roanoke/rlc/ Toll Free: (800) 933-5499. Types Of VA Loans.
Roanoke VA Regional
Compliments of Roanoke and Cleveland RLC
National VA website:
Roanoke VA website:
Toll Free: (800) 933-5499
Purchase or construct a home
Purchase a VA/HUD approved condo or townhouse
Purchase farm property
Purchase a home and improve at the same time
Manufactured home on permanent foundation
Interest Rate Reduction Refinance Loans (IRRRL)
Energy Efficient Improvement
Appraisals take forever!
Too much red tape!
Too much paperwork!
VA takes too long!
Apply for COE
VA Mails Guaranty
Apply to Lender
Appraisal by Phone
Six to Eight Weeks!
Loan Package to VA
Appraisal Received by VA,
Reviewed and CRV Issued
VA Reviews Each Package
(30 to 40 Documents!!)
Lender Packages Loan and
Sends to VA for Approval
Lender Closes Loan
VA Approves or Disapproves
Loan and Notifies Lender
Do You Remember The Past ?
Go to Lender
Where We Are Today…
How we got from there..
Underwrites Income & Credit packages and the Appraisal
Closes loan without sending anything to VA
Lender guarantees loan online through a system called WebLGY
Vets in receipt of non-service connected pension
Vets rated incompetent by VA
Interest Rate Reduction Loans when refinancing a delinquent loan
Submits loan to VA for underwriting
Closes after VA issues commitment, usually in 3-5 days
1% are Priors
Honorably discharged veterans who served:
2 years on active duty
6 years in the Reserve/National guard
POW’s held in captivity for 90 days of more
90 days of wartime duty when called up or ordered under U.S.C. Title 10 (this US code must appear on DD214).
181 days of peacetime duty called up under U.S.C. Title 10
Some unmarried surviving spouses
(90 days applies to Persian Gulf wartime service called up under U.S.C. Title 10)
6 Years Total Service unless activated under Title 10
VA Form 26-1880
Proof of service documentation (DD214, active duty statement of service or Reserve/National Guard points statement)
If veteran had previous VA home that was sold, a copy of the HUD-1 Settlement Statement
An automated system used by lenders to obtain an online certificate of eligibility
Accessed through the VIP
Winston Salem Eligibility CenterP.O. Box 20729Winston Salem, NC 27120
GNMA, FNMA and FHLMC require government loans to have a minimum of 25% guaranty coverage
Basic entitlement – under old law, allows for up to $36,000 for loans not to exceed $144,000
Certificate of eligibility tells the lender, broker or real estate agent how much entitlement a veteran has
A veteran who previously used the VA home loan program would need to sell the home and transfer title to obtain the full basic and bonus entitlement back (restoration of entitlement)
A veteran can obtain a certificate of eligibility over and over, provided they have adequate entitlement
Limited to the lesser of:
Appraised Value or Purchase Price
VA Funding Fee
Energy Efficient Improvements
Maximum VA loan is the lesser of the appraised value or the purchase price
VA loan is based on available entitlement
Secondary market requirements for GNMA, FNMA and FHLMC require at least a 25% guaranty
VA’s maximum guaranty on a $417,000 loan is $104,250, or $417,000 x 25% = $104,250
****WE’VE RAISED THE ROOF****
Example: The COE issued to you shows $36,000 basic entitlement. This amount can be increased to an amount equal to 25% of the Freddie Mac conforming loan limit which is $417,000 across the country – exception for those counties with a temporary increase.
Alexandria, VA, for example, is one county with a temporary increase of $768,750 for a home over $144,000.
Entitlement = $192,187.5 ($36,000 basic + $156,187.5 bonus)….$192,187.5 x 4 = $768,750.
If you qualify for a home costing $768,750, the lender that you are approved through would receive a 25% guaranty.
Veteran purchases a home in 1995 for $100,000 Employee’s Desk?
VA guarantees 25% of loan or $25,000
Loan is still open and being paid on
Assuming the conforming loan limit is $417,000.
If the conforming loan limit is higher – ex. bonus as shown on previous screen would be more.
$36,000 basic entitlement
- 25,000 used
$11,000 remaining basic
+68,250 bonus entitlement
$79,250 total entitlement left
$317,000 maximum loan to
guarantyPartial Entitlement Remaining Entitlement Scenario
What’s changed at VA regarding appraisals?!!!
Minimum Property Standards
Bottom Line: NO “FIXER UPPERS!”
Generally, must occupy within 60 days Employee’s Desk?
IRRRLs – do not have to occupy
Spouse of veteran can satisfy occupancy
If veteran is on active duty, must occupy within 12 monthsBasic Rule Of VA Loans Regarding Owner Occupancy
Veteran receiving 10% disability compensation from VA
Veteran receiving military pension from VA, in lieu of compensation
Surviving spouse of a veteran who died as a result of active duty injuries
Determine that the veteran is a
satisfactory credit risk, and has the
income to qualify for the loan
Income must be “verifiable” Employee’s Desk?
Prefer a 2 year history, but consideration given for at least 12 months on the job
Veteran can obtain VA loan immediately out of the military if employment is related to military technical experience
Explain significant gaps in employmentIncome
If using this income… … you must explain why!!!
to use AUS systems
New HUD1 and Good Faith Estimate
VA will continue to have a cap on the origination fee and limit the type of charges that may be paid by the veteran.
In order to monitor these fees, VA is requiring lenders to itemize these charges in the empty 800 lines of the HUD-1 (effective 5/1/2010).
Lenders will be required to maintain a copy of the GFE and invoices for third party charges as part of their origination package.
The lender may charge the veteran a flat fee up to one percent of the loan amount. The flat fee is intended to cover the lender’s costs and services which are not reimbursable as itemized fees. For Interest Rate Reduction Refinance Loans – this fee may not exceed 1% of the existing loan balance of the loan being refinanced plus the cost of energy efficient items less any cash payments from the veteran.
Circular 26-10-01 – Lists Reasonable and Customary Items along with Unallowable Itemized Fees – Also refer to Chapter 8, section 2d of the Lenders Handbook.
Deed In Lieu of Foreclosure
THE HOMEOWNER NEEDS TO CONTACT THEIR LENDER
If the value of the veteran’s property has dropped and you, as a realtor, cannot get a contract to pay the loan in full, you may want to consider the VA compromise sale program.
If you get a contract equal to the value and the closing costs are reasonable and customary, this program may work for you.
With this program, the lender (on behalf of VA) can step in and pay the difference to pay the loan off plus closing costs that are reasonable so that the homeowner can avoid foreclosure. When the lender reviews a case for VA compromise, they look at the case as if it were going to foreclosure versus allowing the VA compromise to go through. There must be a savings in order for the compromise sale to go through.
If, for example, you submit a contract that equals the value but the value has dropped drastically or the closing costs are too high for whatever reason (or a combination of both factors), the contract will fallthrough.
Interest $ 2,019
Foreclosure Costs $ 1,000
Advances $ 600
TOTAL Debt $113,619
*Net Value -96,943
Foreclosure Claim$ 16,676
Contract Sales Price: $ 95,000
Closing Costs: $ 7,800
Total Debt of $113,619 less Net After Sale of $102,800 =
Comp Claim Payment of $10,819
Potential Foreclosure Claim of$16,676 – Comp Claim $10,819=$5,857.
Savings to VA: $5,857 and VA does not have to take back a property to re-sell.
*Note: net value = appraisal of $105,000 less 11.87% = net value of 96,943.
The 11.87% is the average cost to acquire and market a foreclosed property.