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Lender rating
Since January 2009
The long-term advantages of the VA are pretty impressive too- unless they've changed, you can do a refinance in the future without full documentation. If something were to happen- job loss, etc... they would not check. There's a lot of good stuff- educate yourself on the current upside, but the future upside as well.
Keep as much money liquid as you feel comfortable- get to a payment you like, have a nest egg you feel good about. You can find a middle ground.
Lender rating
Since January 2009
Well, let's take a nice, even 100k purchase price. Let's assume the full 2.15%, but in the interest of round numbers just say 2000 for the funding fee with a 5000 down payment. You said it yourself, Andrew, no MI. He can then take his leftover money and invest that elsewhere- turning his money into MORE money. Say he turns 15,000 into 17,500 in a year. 17,500 into 20,000 in the second year and so-on.
Or he puts 20000 down on the same property and that money vanishes and instead of earning money, it's locked in his homes equity.
Also, does the VA allow for up to 4% seller concession? Hell, the seller could pay all of those fees, and he ends up with a great rate, and a good product that will help him in the future if he needs it. What other loan can you think of that will do a streamline refi regardless of if you can prove employment??? I can't think of one.
He earned the right to have a VA loan, he should take advantage of it.
Thanks to all for your input. I can see that I have some research to do and no doubt will have more questions.
Good luck John! You also started a very helpful thread for others.
Anyone else who's curious about VA loans should go to:
http://www.army.com/money/valoan05.html
I touched on the good refinancing points above, but here is the whole deal with streamline refis:
It's pretty sweet all around.
Lender rating
Since January 2009
Andrew- there is no 'listening' involved, only reading. I was comparing two scenarios, in case you failed to notice. You have a serious attitude problem. What is your major malfunction? What do you have against VA loans?
For some people, putting 20% down DOES NOT MAKE SENSE. That money can be better utilized. Only John knows what he is comfortable with.
Is Andrew always this nice to people? ??????
Lender rating
Since January 2009
AA- I'm not selling him anything.
I hope you don't ever treat your clients to this same level of disrespect. I'd be happy to know it was reserved for your competition only.
John asked what made more sense, to put 20% down or not, AND whether or not to take advantage of the VA loan he IS DUE. I answered him.
Lender rating
Since January 2009
Andrew- you like to argue for argument's sake huh?
First off- the seller can pay the funding fee, as I noted above. Secondly, if anyone financed a funding fee, MIP, or anything similar- they will get that money back through appreciation 10 times over, so what does it really matter anyway? Who keeps a mortgage for 30 years? Not too many people. So your concern for the funding fee isn't really justified. If someone doubles their money in ten years, are they going to care about that 2000 bucks they paid to get their loan? I doubt it. Now, if they were investors, then yeah I guess they'd have to watch every penny they put into the purchase and upkeep of the house- but for the owner occupant, closing costs (unless exhorbitant) should not really be a huge concern.
Lender rating
Since January 2009
You guys need to get the boxing gloves on I think...can I be the first to say you both are right??
John,
They both bring up good points. It all depends if you want to look into investing, or if you want to keep your new mortgage debt down. If you have a good chunk to put down, the other thing you might want to consider is to reduce the term on your loan so you aren't saddled with the debt for 30 years.
E- the gloves are off! :)
Lender rating
Since January 2009
Why else come to Zillow other than the banter....
Are either of you guys managers?
Lender rating
Since January 2009
I gave managing up.
It was either waste time managing others or waste time on Zillow. The Zillow banter is much more fun!
Lender rating
Since January 2009
This post is actually somewhat relavent:
Franklin American is putting an Overlay on VA loans
VA IRRRL’s: (Effective May 1, 2008):
♦ VA IRRRL transactions will no longer be acceptable for properties located in a soft or declining market noted on the
FAMC Adverse Market County List. Those loans must be submitted as a fully documented and qualifying refinance including
an acceptable VA appraisal in accordance with VA guidelines.
Damn you Andrew, now your wasting my time LOL.
Your point about the VA funding fee is quite valid. Lack of mortgage insurance argues in favor of a VA loan at any ltv over 80%. That being said, it does not always make sense to put 20% down on a house, even if you easily can.
But, (and i speak only for me) sometimes there can be disconnect between what we PERCIEVE to be in the best interests of our clients, and what they DESIRE. I look at it like I am only the advisor, I present the facts, point out the positives and negatives associated with each choice, and let them make their own decision. There are too many factors here to judge this one particular scenario. IE: need for interest tax writeoffs, need for quick access to money, time actually going to stay in house, job, kids, expected rate of inflation etc etc.
bad news about overlays on VA but everyone does it to FHA (though not to streamlines) so its not unexpected...
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VA loan question(s)
john562
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I am thinking about selling my current home and then purchasing a new home with a VA loan. 1) Would I be better served to keep the profits from the sale of my home in my pocket or should I put into the purchase of my new home? 2) Should I even bother with a VA loan?
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