For nearly a decade I have been doing VA Loan Training for Real Estate Agents here in Arizona and across the nation and I must be honest with you. Teaching is my passion and I absolutely love to do it. It gets my excited for a number of reasons really. Number one, I have seen so many Real Estate Agents go out and serve Veterans and Active Duty Service Members allowing them to take advantage of their VA Loan Benefits as a direct result of something they learned in my VA Loan Training course. Zig Ziglar a man of faith and motivational speaker use to say ” You can anything you want in life if you will just help enough other people get what they want.” I love that. For so many years we have been fortunate enough to serve Veterans and Active Duty as well as Real Estate Agents allowing them help Vet’s buy and sell their homes the right way.
Below is a course that I recently taught at the Southeast Valley Regional Association of Realtors titled All you need to know about VA Loans.” As mentioned I have been teaching this VA Loan Training course for Real Estate Agents for nearly 10 years and have helped hundreds of Real Estate Professionals navigate the often times misunderstood VA Loan process. My recommendation for you would be to watch the video and go out, spread the news, and educate as many of our Nation’s Finest past and present and educate them about their VA Home Loan Benefits.
“When making a buying decision look for somebody with the heart of a teacher and not the heart of a salesman.” – Dave Ramsey
Any Veteran that ever uses a VA Home Loan will pay a VA Funding Fee. There are exceptions to this which we will cover shortly.
Simply stated, the VA Funding Fee is fee required to reduce the loan’s cost to taxpayers by making Veterans contribute towards the cost of using the his or her VA Home Loan benefit.
Typically the VA Loan Funding Fee is paid one of 3 ways…
Financed into the loan
Paid for out of pocket
Paid by the seller
In my experience most Veterans have opted to finance the fee into their loan amount so they can avoid paying it out of pocket.
How Much is the VA Funding Fee?
Let’s talk about how much this fee will cost you, the Veteran. For a first time user the VA Funding fee is typically 2.15% of the loan amount.
However, for a first time user that happens to be a Reservist or National Guard, the fee goes up slightly, to 2.4%.
Anybody that has used a VA Home Loan more than once is considered a subsequent user and is subjected to a higher fee. For these Veterans using a VA Home Loan for a second time or more are required to pay a 3.3% fee.
How to Reduce the VA Funding Fee
There are ways to reduce the VA Funding Fee or possibly not pay it at all.
To reduce the fee the Veteran has the option of putting anywhere from a 5%-10% down towards the purchase of their home.
With as little as 5% down, the fee will be reduced to 1.5%.
With 10% down the fee will be reduced to 1.25%.
As you can see the VA encourages Veterans to put money down towards the purchase of their home if they are able.
VA Funding Fee Waived for Disabled Veterans
For Disabled Veterans, meaning you are have a service connected disability from the VA, and are as little as 10% rated, your fee is waived.
Needless to say if you are a Veteran and have this benefit, it can literally save the you tens of thousands of dollars over the life of the loan.
Keep in mind you must prove this to your lender in order for it to be waived. To do so, simply provide a copy of your VA service connected disability paperwork to the company originating your VA Home Loan to get the fee waived.
Fore more information about the VA Funding Fee and your VA Home Loan please click on the Apply button and fill out an application and we can follow up with you shortly thereafter.
Here in Arizona there are over 500,000 Veterans living among us right now. Kind of a big deal right? The reason why I say this is because I know how many Veterans that are out there that don’t know the full description of their VA Home Loan benefit and how it works. I am also reminded of how many of our nations finest men and women that are still serving and deployed overseas that will eventually exit from their branch of service and join the ranks of the civilian sector. Keep in mind that this is a number that I believe will continue to increase due to the ending of military operations in places like Afghanistan. Which leads me to my next question…Are Veterans prepared to purchase a home and use their VA Home Loan Benefits when returning from the military or at any other point in their lives?
VA Home Loans are so unique. In reality there is really no other type of home loan out there that exist that allows a Veteran to purchase a home up to $417,000 with no down payment (and in some cases higher). Furthermore, Veterans must also understand that in order to use your VA Home Loan Benefit you do not need to have a 800 Fico score as much of the media may lead you to believe. With VA Home Loans, most lenders require a 620 credit score allowing Veterans with less than perfect credit to purchase homes. Lastly, the VA Home Loan allows Veterans to purchase a home with limited closing cost, saving the Veteran in some cases as much as $1,500 in closing cost.
So why do VA Home Loans matter? Simple, because they are the bridge between Veterans and home ownership! In closing, I am often times asked the question… “Jimmy is there ever a time when a Veteran should not consider a VA Home Loan?” No. I say this because in most circumstances that I see on a daily basis the VA Home Loan is just as competitive as a Conventional home loan and certainly more competitive than a FHA Home Loan.
Thank you and may God bless you for your service to our great country.