If you’re selling your home, it’s time to get familiar with the VA home loan — yes, even if you aren’t military yourself. Here’s why. Veterans or active duty military homebuyers are likely to use the VA loan when purchasing a home.
What you’ll learn in this article:
What is the VA loan?
Preparing Your Home to Sell
Research Housing Rates for Your Area
Market to Military
Meeting VA Requirements
The VA Home Inspection
What is the VA loan?
For those of you unfamiliar with it, the VA helps those who are eligible purchase a home at a competitive interest rate, often without requiring a down payment or private mortgage insurance. That means that they not only offer zero down payment loans, but also have lower credit requirements than alternative financing options.
As you can imagine (or have used yourself), the VA loan is a popular choice. So if you’re near a military installation, the likelihood of your potential buyers using this lending option skyrockets. Don’t be mistaken, while there are duty stations tucked away on their own, there are plenty positioned in the heart of major cities that you might not even realize. The point? Thorough research can help you to consider all aspects of the buyers in your area. As a home seller in a heavily dominated market, consider getting to know the lending terms of the VA loan and how to market to VA home loan buyers.
Preparing Your Home to Sell to a VA Home Loan Buyer
There are a couple of key things to know about selling your home to a VA home loan buyer.
“One is that there isn’t a safer bet to close on the market. VA loans have had a higher average closing success rate than conventional loans over the last five years. The other piece is that sellers are not required to pay any costs on behalf of a VA buyer. There’s a misconception that sellers have to pay a VA buyer’s closing costs or are on the hook for repairs if the VA appraisal turns up issues. This isn’t a zero-sum situation, and both are matters of negotiation between buyer and seller.” — Chris Birk, Director of Education for Veterans United Home Loans and the author of The Book on VA Loans: An Essential Guide to Maximizing Your Home Loan Benefits.
Research the Local Housing Rates for Your Area
Here’s an interesting fact: you can look up how much military servicemembers and their families are allotted each month for housing. It’s called the Basic Housing Allowance (BAH). While it isn’t a perfect representation of each family’s personal budget, it does provide a decent baseline to understand where your property falls into the mix.
Enter your zip code and a pay grade. Unless you live close to the Pentagon, you’ll be better served by estimating housing rates on low to mid-level pay grades, such as an O3 or E5.
Estimate the mortgage payment for your property.
Using a mortgage calculator, such as MortgageCalculator.org or Bankrate’s mortgage calculator, you can input your asking price, property tax, and estimated homeowner’s insurance. Consider adding two to three percent to your asking price to account for the VA funding fee for first- or second-time VA homebuyers.
Do the math.
Given the BAH for the local area and the cost of your home, will military homebuyers in your area be able to afford the monthly mortgage payment for a zero down payment VA loan? If your home sale price fits the military homebuyer’s budget, then great! It’s time to market to the military community. If not, homebuyers have the option to purchase your home with an alternative loan product—like state down payment assistance programs and FHA loans. However, for those who qualify, the terms of the VA loan are hard to beat.
If you’re in a tough selling market, consider working with your real estate agent to target homebuyers who may be eligible for these products.
Market to Military
When you market to military homebuyers, you’re working with a unique clientele who, unlike any other homebuyer, operate on a time crunch.
Since military families receive PCS orders for an average of three years, they don’t have the luxury to take weeks or months to find a home to buy. Instead, many families find a home within just a few days.
Knowing this about the military home buying market will help you understand why it’s critical to have great photos, a detailed description of your property’s layout, and a video home tour. Each of these marketing tools will help ensure that you make it onto your military homebuyer’s shortlist of potential homes.
The Logistics: Meeting the Requirements of the VA
The process takes longer when you sell to someone who is using a VA Home Loan than that of most other mortgages.
One way to expedite this process is to make sure that there aren’t any repair issues with your home that may cause either delays for repair or an outright rejection of your home. While the home buyer is required to pay for the inspection and appraisal, it’s not a bad idea to conduct your own pre-inspection with the intent to get your house ready to sell quickly.
For a few hundred dollars, you can mitigate this situation by hiring an inspector who is familiar with VA requirements. Consider it money well spent, as the VA loan follows a set of Minimum Property Requirements (MPRs) set to ensure that the property is safe, sanitary, and habitable.
VA Home Appraisal
“The appraisal process looks a bit different. Beyond the typical home valuation, the VA also considers broad property condition requirements. These Minimum Property Requirements are rooted ensuring Veterans are purchasing homes that are safe, sound, and sanitary. This assessment isn’t as in-depth as a home inspection, and any issues raised by the appraiser can be addressed in order to keep the deal moving forward.” — Chris Birk
Common things evaluated by the home appraiser:
Heating and electricity. If the home has a wood-burning stove, is there a backup system?
Water. Does the home have a water heater and access to drinking water and a working septic?
The roof. Does the roof have a substantial amount of life left? Are there any leaks?
Access. Can you reach the property by foot or car by way a private or public road year-round?
Defects and deterioration. Is the home free of defects to include poor construction, or wood-eating insects like termites?
Paint. Is there any lead-based paint that’s chipping or peeling that needs repaired?
The location. Is the home located on a gas or petroleum pipeline or near high-voltage electric lines?
Tips for finding a home inspector:
Get recommendations. You can’t be expected to know the local professionals when you’re new to the area. Check with your real estate agent, loan officer, or experienced friends who can point you in toward a respected home inspector.
Look within reputable organizations. Organizations like the American Society of Home Inspectors and the National Association of Home Inspectors require certifications for membership. Finding a local who belongs to one of these groups assures a high standard of service.
Know your state laws. Licensing requirements vary from state to state. If you’re unsure of yours, ask your real estate agent and make sure your home inspector meets the criteria.
Ask for a sample inspection report. Nothing is better to determine the quality of someone’s work than viewing a sample of their job. This can tell you a lot about an inspector’s level of experience. You’re looking to make sure the report is clear and that it includes images of any identified issues around the property. You’ll also want to see recommendations made for potential homebuyers.
Consider your budget. Home inspections aren’t free. The cost can vary depending on the provider, the size of the home, and location. However, they most often fall within $300 to $500.
VA Home Inspection
Things the home inspector looks for:
Structure. What’s the condition of the property’s construction (walls, floors, foundation, roof, and ceilings)?
Exterior. How much life is left in the current siding, windows and trim? Looking at other features– how’s the exterior lighting and fences? Is there proper drainage based on grade and elevation?
Plumbing. What are the pipes made of? Is everything up to current standards to include the toilets, showers, sinks, faucets?
Systems. Are the chimney, fireplace, water heater, furnace, A/C unit, and septic system all in good working condition?
Roof and attic. Is the framing sound? Is there proper insulation and ventilation?
Electrical. Is the electrical wiring properly grounded? Are all the light fixtures and the main electrical breaker safe and working correctly?
Appliances. What’s the condition of the appliances like the dishwasher, range, built-in microwave, garbage disposal, smoke detector, and any other relevant small appliances in the home?
At the end of the day, remember that VA home loan buyers want the same thing as everybody else: location, good schools, and more. The basics to preparing your home to sell for a VA home loan buyer are the same as most others; it’s simply a few particulars that keep you on your toes.
Way too many of us have a story about our credit card getting hacked or about being a victim of one of the massive data breaches in recent years. As technology becomes more and more a part of our financial lives, it becomes increasingly important to keep a close eye on our personal credit.
By monitoring your credit score and credit report, you can make sure you know if someone has opened unauthorized accounts in your name.
Monitoring your credit has the added bonus of helping you make sure your credit rating is where you need it to be.
The Easiest Ways To Monitor Your Credit
To put this task in “set it and forget it” mode, you should set up an account with at least one website designed to monitor your credit. (If you’ve frozen your credit, you’ll need to unfreeze it with at least one credit bureau first.)
Monitoring Your Credit With Credit Karma and Credit Sesame
When we talk about monitoring your credit, we’re talking about keeping an eye on both your credit reports and your credit scores.
Credit reports include all the details on your credit accounts, both current and closed. The reports track payments and other information for every loan, credit card and line of credit you have.
Your credit scores are numbers based on that credit history and activity.
If you have any credit history at all, the “big three” credit bureaus — TransUnion, Experian and Equifax — will each have both a credit report and a credit score associated with your accounts. The good news is that you can access all of this information for free online.
Money expert Clark Howard’s favorite site for monitoring your credit is Credit Karma. This site lets you keep tabs on your credit score and view credit reports for free. Once you set up your account, you’ll get:
Your estimated credit scores from TransUnion and Equifax
Access to your credit reports from TransUnion and Equifax
The option to get an alert when your credit score changes or something is added to your credit report (credit monitoring)
Additional services including identity monitoring, free tax filing, and access to your auto insurance score
Again, you will need to set up your Credit Karma account before you freeze your credit, or you’ll need to unfreeze your credit in order to sign up.
You may have noticed that neither Credit Karma nor Credit Sesame gives you access to your Experian credit report and score. But you can get your reports for free directly from both Experian and Equifax by creating online accounts with them (Experian also includes your credit score):
While monitoring your credit is crucial, it still means that you’ll find out if someone else has opened a credit line in your name only after the fact. So you should freeze your credit with all three major credit bureaus.
With a credit freeze in place, no one (not even you) will be able to open a new line of credit in your name without first unfreezing your credit — which only you should be able to do.
Be careful before you press send—what you write in that email could be legally binding, as held by a New York state appellate court in July.
The case involved settlement negotiations that occurred over an email exchange between two attorneys. The attorneys were negotiating a settlement and one of the messages contained a certain dollar amount for settlement. That email contained a standard signature block but did not include the attorney’s typed signature. The other attorney confirmed the agreement.
A trial court ruled that the email exchange did not create a binding agreement because the sender did not type their name in the email message. Previous cases have stated that as well.
“This case means that pressing ‘send’ on an email is now potentially equivalent to signing a piece of paper containing whatever statements appeared in the email,” Forbes.com columnist Joshua Stein reports on the case. “An actual typed signature is not necessary.”
The court also ruled that for an email to bind parties, it must summarize all “material” terms of the deal. In this case, that constituted the amount of money to be paid.
Senders may want to make it clear in writing that your email does not intend to create any form of a binding agreement.
Many standard email disclaimers state that automatically on every message. But still, even with a disclaimer in place, watch your messaging before you press send, Stein cautions.
Living where we do in the foothills, among the trees and beauty of nature means that we may at some time be faced with the threat of wildfire. What can we do to be prepared if that time arises?
Well, let’s think about your situation. Do you have pets, medications, pictures, and important documents? Of course, you do! We all have something we couldn’t bear to lose or at the very least would make life difficult if we did. Let’s make a list and prepare a bag now. My emergency checklist may be different than yours so really think about it and make changes as needed so you don’t have to think about it when under the pressure of evacuation. Get your emergency go bag ready, NOW. Here is a sample checklist. Print the PDF and hang it up where you can easily see it. Place items in a bag or laundry basket where they are easy to grab on your way out the door.
Living where we do in the foothills, amongst the trees and beauty of nature means that we may at some time be faced with the threat of wildfire. What can we do to be prepared if that time arises? Well, let’s think about your situation. Do you have pets, medications, pictures, and important documents? Of course, you do! We all have something we couldn’t bear to lose or at the very least would make life difficult if we did. Let’s make a list and prepare a bag now while there is no immediate threat. My emergency checklist may be different than yours so really think about it and make changes as needed so you don’t have to think about it when under the pressure of evacuation. Get your emergency go bag ready, NOW. Here is a sample checklist. Print this out and hang it up where you can easily see it. Place items in a bag or laundry basket where they are easy to grab on your way out the door.
Pack your go bag so you can grab it and go!
EMERGENCY EVACUATION GO BAG CHECKLIST
Social security cards
A list of personal contacts
Proof of insurance
Pink slips for cars
Deed to your house
Life insurance policies
Thumb drive/memory card
First aid kit
Food and water, 3 day supply
Medications- prescription and non-prescription
Food/water for three days
One change of clothing and shoes for every member of the family
Items that cannot be replaced
Other items to consider adding to your emergency go bag
Eyeglasses, contacts, contact solution
Infant formula, wipes, bottles, diapers
Sleeping bags or blankets and pillows for each person in the household
Licensed real estate agents in California are required to “hang” our licenses with a Broker unless we have our own Broker License.. So does the brokerage that your agent sells with make a difference on buying and selling? You could likely find many many different opinions on this topic. For me it was pretty simple.
I had been in Real Estate for just over 4 years and had a small team. It was my partner Dennis Geare and I and our one team member Kendra Del Rio. We had some issues arise and we knew it was time to change brokers. Changing brokers is not easy. It is similar to a break up and a BIG move all in one. So of course we wanted to make a move that would fit us for many many years to come. After lot’s of research and conversations with brokers and agents, we made our choice. That choice was HomeSmart ICARE Realty.
HomeSmart ICARE Realty was a newer name in the California market and its business model and plan for agents was like no other we had seen. HomeSmart ICARE Realty is a veteran- owned company based in Phoenix, Arizona that operates franchise locations nationally. The owner of the HomeSmart ICARE Realty unit we were joining had been in business for about 6 years and has about 100 agents in the Sacramento/Roseville area.
The HomeSmart ICARE Realty business model is what attracted us, unlike any other we had seen. HomeSmart ICARE Realty offers low flat rate fees to licensed real estate agents based on transactions, giving us the freedom to build our business based on our team, and our business ethics and morals. And, of significant importance to us, gives us the ability to better assist our clients buy and sell homes! Finally, HomeSmart ICARE Realty are HUGE supporters of veterans and also of community events and groups.
We knew that a lot of people would not recognize the homeSmart ICARE Realty brand, but we had built our own team brand that would carry us through the change over. Now 2+ years later I am looking back on that decision to join HomeSmart ICARE Realty Grass Valley and so thankful we did. Making the change has allowed us to open our office located right where we want to be. The broker and owners of HomeSmart ICARE Realty have been kind, supportive and so much fun to get to know and work with. This change has also allowed us to do more for our community than we thought possible. We support groups like Safe and Sober Grad Night at BRHS, local school events, “Giving Tree” at Christmas, ASPOA Yard Sale event and we have been on the front-end of helping with natural disasters to get items to those in need.
So as we kick off 2019 and I look back over the last few years I can honestly say that making the switch to HomeSmart ICARE Realty Grass Valley and helping to open the office located at 10015 Alta Sierra Dr 5B Grass Valley, CA 95949 has been one of the best decisions!