12-17-2010 07:44 AM
I was wondering how long it would typically take a VA Loan to close? Pre-Approved.
ON A SHORT SELL?
ON A FORECLOSURE?
ON A REGULAR SALE?
Can you use a VA Loan on a property at auction?
I'm interested in closing as soon as possible.
12-17-2010 10:27 AM
What kind of auction? Trustee sales at the courthouse steps are paid in all cash after the auction. Other auctions will have differing requirements so you would have to look at the rules.
Closing generally takes 4-6 weeks from entering escrow.
Short sales are different as the 4-6 weeks timeframe doesn't start until the lender(s) sign off. This can take months and in some cases over a year.
In order to have a smooth escrow, the buyer can be on top of things. Waiting to provide documents requested adds more time to the process. Get financials in order, don't purchase on credit and don't get new credit cards until after closing. This means waiting for that fridge thats 18 months no interest or that killer deal on a new car.
12-17-2010 10:45 AM
Firstly...thank you for your service. You have very good questions, that really depends on who is brokering the loan. I work a lot with military clients and am a preferred agent with a well known company that caters only to military clients. Right now; they have fallen a bit behind due to layoffs within their company, so they are requiring fewer loan processors to do more, which makes the process longer and more frustrating. This particular company is telling us (agents) that it is a minimum of 45 days to close the loan...and that is with its members already pre-approved. They are based out of Texas and Arizona, so they are not keen to our Southern California speed and time-frames.
I started working with another "direct lender," based in San Diego. The loan person I am using is the president of her small company...and right now I have a Navy client who will be closing on 12/22/10. We wrote, presented, negotiated and got my clients offer accepted on 12/1/10, at which time escrow was opened...so, she is doing the loan from start-to-finish in 22 days...and my Navy client is using VA.
So...I would try to locate a "direct lender," vs. a "mortgage broker," as the broker typically take a bit more time and have more hoops to jump through.
On to your next questions...
RE: Short-sale - Short sales are a challenge at best...and you will most likely wait 30-120 days just for a response to your offer. Short sales typically won't allow closing cost credit, "and"...most importantly for you if you are using a VA loan...they most likely will not grant a sec 1 and 2 pest clearance. If you are using a VA loan...the Veteran's Administration "require" the "seller" to pay for and provide the clearances. There is no negotiating it, or taking a credit for the amount of repairs...VA just will not allow it.
RE: Foreclosures - Another challenge, but not at all impossible. Most of the bank owned homes know that VA require pest clearances and will grant them. However; the VA also has what are called "health and safety items" that must be in place, i.e.. electrical, plumbing...no bare wires, missing ovens, etc...or, the VA certified appraiser will indicate these items as deficiencies and the lender will not fund until these items are corrected. So...when showing REO (real estate owned) properties...I think it is important for your agent to "preview" any homes prior to showing you, to make sure that they meet the basic requirements for lending. I have sold many REO properties to my military clients in the past 6 months...all using VA loans, in multiple offers...with about 80% success in getting our offers accepted. What helps is being very thorough in the offer paperwork and most importantly...following instructions.
RE: Using VA loan at auction - Auctions typically want cash/cashier's checks for the amount of purchase, and I am unaware of anyone ever being successful with a VA loan at auction.
I hope the above helps you and sheds a little more light on things for you.
01-14-2011 11:09 AM
A good VA direct lender can always close under 30 days. USAA is good, but you and/or your agent have to stay on top of your disclosure timelines. Working with hourly employees at USAA can save you a little $$, but they don't have as much incentive as normal lender. Also, if you're a first time buyer, sometimes it's better to have a lender you can sit down with and ask questions etc... Prime Lending is really good at VA. They've closed for me in 20 days.
There's no way to use a VA loan on a Rehab. You can use an FHA rehab loan however with 3.5% down and get up to about 35k in rehab costs. However, you will also have to pay PMI (private mortgage insurance) with FHA, but NOT WITH VA! PMI can run you a couple hundred per month depending on purchase price. Additional FHA fees are BRUTAL now as well. The closing costs on FHA really add up.
If you can go VA, it's the way to go. Get a good buyer's agent who can negotiate to have the seller pay all of your closing costs as well and get in with literally ZERO down and your first month's mortgage paid.
If you're a veteran with ANY level of disability (even 0%), then the VA will waive the 2% funding fee!