First home with VA home loan, getting a little confused on things help?!?
We have been pre-approved for a VA home loan. Now I am house hunting and I'm wondering how much of a pain a foreclosure or short sale is going to be with VA. I know VA has their stipulations on closing costs, and condition of the house. Then I'm seeing lots of foreclosures/short sales that have a list of things that often contradict the VA such as they will not repair anything, which is VA required. Are banks often flexible changing some of these things? Or am I better off avoiding short sale/foreclosures since they tend to drag out longer and probably will conflict with VA requirements?
I do not have a realtor yet, I'm taking a trip this weekend to look at some places. We are moving from San Diego to the Phoenix area. I just wanted a better idea what I'm getting into here.
- Anonymous1 decade agoFavorite Answer
FOR A FIRST TIME BUYER,YOU HAVE A VERY GOOD GRASP OF MARKET CONDITIONS, WHICH IS GREAT.
I SUGEST YOU STAY AWAY FROM SHORT SALES.THEY TAKE WAY TOO LONG AND MORE TIMES THAN NOT YOU GET A TRUE RUNAROUND
FOR NOTHING .FORE CLOSURES CAN DIFFER FROM LENDER TO LENDER,
A WELL TRAINED AGENT CAN LOCATE SOME( reo's) WHICH WOULD FIT
VA'S REQUIREMENTS.PHOENIX IS STILL CONSIDERED A DECLINING MARKET,SO INVENTORIES OF THE BANKS SHOUD ENABLE YOU TO CHOOSE.A STANDARD SALE,AS LONG AS PRICED CORRECTLY,IS ANOTHER OPTION.AND SELLERS OF THESE TYPES CAN AND WILL BE
FINALLY,YOUR BIGGEST TASK WILL BE FINDING THE RIGHT REALTOR
SINCE,AN EXPERIENCED AGENT CAN STRUCTURE THE TERMS IN A WAY THAT SATISFIES YOU,VA,AND THE SELLERSource(s): 30YEARS R.E.AND MORTG.BROKER
- Steve DLv 71 decade ago
Foreclosures and short sales are probably not likely candidates for the VA loan unless in good enough shape to pass the VA inspection. Banks are not in the business of holding and selling real estate. In a foreclosure, the bank has already taken a financial hit and your ability to negotiate repairs is almost nil. In a short sale, similarly, the bank will not want to fix the property and the current owner has no incentive to offer anything since he is out of a house.
- Anonymous1 decade ago
Short sales especially are not a good candidate for a VA loan. Generally a short sale is AS IS because the bank usually does not own the original mortgage and has to request the investors (could be many) to approve the offer. If there are unknowns (such as needed repairs), it is likely that at least one of the investors will refuse to sign off.
Because of the approval process, short sales usually also take a long time.
- Anonymous1 decade ago
While we need to get these off the market, what you might consider is only looking at those being sold by Fannie Mae or Freddie Mac. Get on their website to see where their properties are. They clean their properties, and want them in sellable condition. You provide pretty quick answers to offers. And in some cases if you catch it just right, like say in September, Freddie Mac is offering closing costs on properties with an acceptable offer. I'd stay away from short sales, in most cases the lender hasn't approved anything, and in most cases can't make a damn decision on an offer to save their lives! Besides it's more profitable for the lender to let it foreclose, then have the treasury buy them out.
I hope you have a Realtor that knows the foreclosure market in your area. Don't use just any Realtor. They should possess some experience in dealing with these types of properties. VA will have the house inspected, saves you a few bucks.
Best of luck and thanks for being in the market!
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- PengyLv 71 decade ago
In a short sale or foreclosure the banks are already losing money so they will not invest any, and for what it is worth they are the hottest selling properties right now. VA is somewhat particular in the house does have to be habitable, good furnace, roof, electric no peeling paint etc. But it is the only game in town to get 100% financing. I did
- chatsplasLv 71 decade ago
Banks are NOT going to be flexible on changing these things.
Many homes WILL pass VA regs. You might end up making the repair at your own cost if you WANT a home and VA requires it.Source(s): real estate investor