BUSTED - 10 VA Loan Myths Debunked

Today we're breaking down the top 10 VA home loan myths that prevent or stop veterans from using that amazing VA home loan. So welcome to the channel. So let's jump right into it. So the first myth that we come across is that VA home loans are difficult to qualify for. And it's actually on the contrary, because VA home loans are extremely flexible. And if you work with a lender that does the VA home loans based on the VA handbook, which I did a whole video on and also drop that in the description, it's basically outlines everything a lender uses in order to qualify you for a VA home loan. Now, the thing is, you could also search it yourself or reach out to us and we're happy to walk you through that process and also be able to get you qualified for that amazing VA home loan. Myth number two is the VA acts as a lender. They do not, in fact, they don't do VA home loans for the most part. The only loan that they do control and actually underwrite and close themselves is the Native American direct loan. So if you fall into that category, you can definitely do some research online around that. VA is not the one that otherwise for the general public, the VA doesn't sit there and say, oh, this is what the interest rates are or, hey, this is your qualification. Lenders are the ones that do it. So oftentimes we'll talk to veterans and they'll say, well, the VA denied me or the VA said this. And it's coming from a lender that may look like the VA. So just keep that in mind as you're going through that process. If you don't get qualified for a loan for whatever reason, hey, reach out to someone else and get a second opinion. Again, we're happy to help you on that. Third myth is going to be VA appraisals are too strict. Now there's a couple of pieces to this that are both true and not, because again, this will also be specific to the lender. Now, in general, let's say we compare a VA appraisal to a conventional appraiser. Yes, technically they're going to be a little bit stricter because the VA does have what it's called its minimum property requirements. They require for the property to make sure it's safe, sound, and sanitary. And remember, majority of veterans are taking out a VA home loan at a hundred percent financing. So both the lending institution and the veteran need to be protected in the event something were to happen, the home needs to be sold. They just want to make sure that their asset is protected. Now, another piece to that is you can do escrow holdbacks as a veteran buyer, right? Not an attorney here, but most or some lenders will actually allow you to do a escrow holdback for those repairs. So good example of that is let's say you're appealing paying a thousand dollars. Sellers don't want to do it. You don't want to lose the home because it's already hard enough to get a property. You then get a quote, let's say it's a thousand. You're going to put typically a hundred and fifty percent of that one, you know, fifteen hundred into an escrow account at closing. Work is done. Appraiser goes out, make sure it checks out. And then you get the money released back to you. So a lot of good things around that. And I'll also link a video down below for the like a complete video for the for that process and how that works. Another myth is V-Home loans take longer to close than a conventional loan. This, I think, is where it's both true and false, and it really depends on who you work with. Some lending institutions will say they specialize in V-Home loans, which I think in a way they're just you know, you're paying for a lot of that marketing that they're doing to you because it has to be paid for somehow because margins aren't crazy big on home loans. And maybe that's why that happens. But the thing is, is for that process, you know, what we typically see on my end is about twenty one to twenty five days from start to finish. Now, it all depends on when you order things like an appraisal. If you're a state that has attorney review, how fast you process through there. So there's going to be that variables. And then also the size of a lending institution does make a difference because normally the bigger it is, the more things fall through the crack. We do see that as something that's pretty common from viewers like yourself that reach out and schedule consultations with us. But typically it is a fast process. Now, if you mix in. Let's say there may be an appraisal issue and you're cutting it close to the closing date that may delay it. And another part to that is if you're trying to get by a condo without the condo approval, that can push out that twenty one, twenty five big time frame. But typically, depending on where you are, kind of people don't take that long. And I'll also drop a link in the video for that as well. Another myth is that VIA home loans cost more. So not too long or like a little while ago, Dave Ramsey came out and said, like, VIA loans are horrible, they're very expensive. And to a certain degree, he's he's correct. But again, that depends on the lending institution you work with. Typically, when I'm looking at loan estimates, again, this is like my personal experience looking at like loan documents all the time is that I will see. Veterans pay two to three percent more in closing costs because they want to, I don't say they want to, but they pay for additional fees like origination fees and discount points where they really don't have to do that if they work with somebody else. But ironically, I think I did a video not long ago that it's like veterans overpay like thirty eight million dollars a month and in extra, I would call them junkies. They wouldn't have to spend. And I think this is, you know, this is why we do this channel is because we want to get education to the veterans to be able to educate yourself on that process. Another myth is that foreclosures prevent future VIA home loan usage. Now. There's a couple of parts to this is that if you had a foreclosure, let's say with a conventional loan, you still have your full VA home loan benefits to be able to use. If you had a foreclosure with a VA loan, then you lock out a portion of those benefits. So let's say, for example, you. Had a mortgage for two hundred thousand original balance, right? That's what the VA goes off on. Even if the balance was one fifty by the time you went to foreclosure, you'd still lock out two hundred thousand dollars of your benefits. Now. If you guys are aware, the VA loan technically doesn't have a limit as long as you're eligible and qualified, meaning you don't have an outstanding VA home loan and you haven't had a foreclosure with a VA home loan on the property and you haven't repaid that balance back either. What happens is that it goes back to the old rules. We have a max county limit, and I'll also link a video on that just kind of showing what that looks like. So in this case, it would be as if you were getting a another VA home loan and keeping a VA loan, it falls within those same parameters on how to calculate what you qualify for. So don't disqualify yourself. Reach out to someone and please, you know, don't deny yourself. Reach out to someone. Next bit is veterans think they can only use the VA home loan once they've left the military. This still comes up today. And this is it's crazy, because as soon as you're eligible for the VA home loan, you can use it. And there's also no time period between you getting out and you using the VA home loan. That is something that still comes up today that people. Well, my realtor said or this person said, I have to wait one year from getting out to use my VA benefits. It's all about your income. So it's more of a qualification question than an eligibility question, right? You still need to have a job or your disability income. And we have a bunch of videos on the channel. So check them out around that. The next myth, which is real estate agents prefer conventional loans to VA home loans. Now, this is the crazy thing. Even when I went through the home buying process last year and I do this for a living and I teach this stuff, I love the home loan. They also have questioned my choice of using a VA home loan. Well, why don't you use a conventional? And I think, well, nothing. I know a lot of times it's the lack of education around the VA home loan, the benefits and how they work. And then also people working with larger institutions where there's really no communication and people don't get qualified correctly. And I'll link a video to that as well. I feel this should be a painful process to get qualified. You need to submit all your documents. Lender needs to review everything. They need to scrub everything and ask for more documents because people get misqualified all the time in this process, causing both the real estate community to have a negative taste to be alone. And we have to remember, a lot of people don't do a lot of VA loans. So it's a lot of hand me down information that they get. This is why you need to have a solid team in place, right? You know, when your agent's making an offer on the property, they need to be very detailed on what they can do with the program itself. They've checked out the property themselves. They've identified, hey, these are potential issues. Hey, lender, can this cause an issue? Can we do an escrow hold back for it? The more you communicate, the better it's going to be. And then last one, we're going to talk of our last myth we're going to be talking about is that VA doesn't allow construction loans. Yes, they do. You are able to purchase land and do a construction loan at the same time. No, you cannot use a VA loan just for land purchases. You would have to go through conventional means for that. There's plenty of banks out there that just specialize in land loans. And there's different types of land loans that are also out there, not including USDA loans that exist, which are actually pretty phenomenal. I'm looking into that right now myself, and I'll be doing it. I'll be dropping a video on that here in the next couple of weeks. I'm pretty excited about it because there's a lot of opportunities for veterans to be able to become homeowners. So make sure you guys hit that like and subscribe button, and I'll catch you guys soon.