Is Your Real Estate Agent VA-Reluctant?
There’s no doubt you should use a real estate agent when shopping for a home. When it comes to making a fair offer, contract negotiations and being your advocate throughout the buying process, the agent is right there with you. There are times however when a real estate agent may attempt to sway you from using a VA home loan. Don’t let them.
Real estate agents who aren’t very well versed with VA loans are likely carrying old VA baggage that still seems to permeate the real estate landscape. Why? For a couple of reasons.
Some agents still think that VA loans take a long time to process. That the VA must approve the loan directly and both order, review and approve the appraisal as well. That was the case many years ago but not so today. It did in fact take weeks, months sometimes to get a VA loan through the system. Especially if the property was in an area far away from any regional VA center.
When listing agents saw that the buyer was going to finance the purchase through the VA, the seller knew it could take a long time to close. Today however, approved VA lenders can not only review and approve the loan in-house but order, review and approve the appraisal as well. VA loans take no more or no less time to approve than other mortgages.
Second, VA loan programs limit certain closing costs the veteran may pay. Some fees such as lender processing or underwriting charges, escrow fees and other typical closing costs are off-limits to the borrower. This means the seller would be liable to pay those costs on behalf of the buyer.
While this is true, the lender may also issue a lender credit or the borrower may elect to pay a one percent origination fee in lieu of the restricted closing costs. If your agent tries to send you to a non-VA lender then it’s time to find another agent.