The VA loan and real estate agents
There’s no limit to the amount of information available on the internet. No news there. But sometimes you need more than just information. In fact, some say that information is nothing without something else: experience. You can gather all the information you want about snake-handling but without any experience, do you want to venture into a project that can literally bite you?
This analogy applies to a specific area of buying a home and financing it with a VA loan. No, you don’t need experience with VA loans but you should seek experience with your real estate agent. Your agent needs to have experience making offers on behalf of buyers using their VA home loan benefit.
One of the provisions of VA loans is regarding the types of closing costs a veteran may pay in conjunction with buying and financing a home. Veterans are allowed to pay for specific items such as an appraisal, credit, title insurance, recording fees, origination charges and other limited charges. Any other charges must be paid by someone else. Sometimes that someone else is the seller.
If you use a real estate agent that is not aware of the closing cost limitations for VA loans, then your offer might be declined at the outset when the listing agent sees that your offer includes VA financing. Some sellers aren’t’ aware of how to properly address VA offers, thinking incorrectly that the VA loan approval process is awkward, slow and costly to the seller.
On the contrary, VA loans are approved just as swiftly as any other loan program and while the veteran is limited to certain closing costs (a good thing) without a proper presentation the offer could be turned down.
Your agent needs to be aware of closing cost requirements and fashion your offer with them in consideration. Your offer should include having the seller pay for your non-allowed closing fees. Someone has to pay them; it might as well be the seller, right?