Tom and Cindy Ralston join me today to talk about veteran buyers and VA loans.
In the latest episode of my “Ask a Realtor” series, I invited Tom and Cindy Ralston back from Lyon Real Estate to talk about veteran buyers.
When one of my clients makes an offer on a house they want, the first thing that I do is pick up the phone and call the listing agent. I want the listing agent to know about the strength of the buyer’s loan and their ability to close. With VA buyer’s specifically, I sometimes get push back from the listing agent because there are some fees that the buyer is not allowed to pay.
To overcome that push back, Cindy tells me that she encourages a larger earnest money deposit. Instead of a 1% earnest money deposit, they encourage you to put down 3%. They also told me that they want to work with a lender who can do the underwriting upfront and guarantee that there are no loan contingencies. This is sometimes called a “fast pass” and can help veteran buyers greatly.
Even with no finance contingencies and a shorter close, there can still be some hesitance from the listing agent because of the unknown costs that can arise from a veteran buyer being unable to pay for fees. There is a rather long list of things that a veteran cannot pay for with regards to fees. Termite inspections and pest reports are common issues. While a veteran buyer cannot pay for the initial termite inspection which costs about $100, they are allowed to pay for any repairs that may be discovered from it. There are plenty of other things that a veteran can pay for including the appraisal.
If a buyer wants to come in with a $0 down payment, we can get around some of the fees by using lender credit to pay for some of those items so that a seller does not have to pay for all of them.
“Even with no finance contingencies and a shorter close, there can still be some hesitance from the listing agent because of the unknown costs that can arise from a veteran buyer being unable to pay for fees.”
Lyon Real Estate has certified both Tom and Cindy to be part of the MOM program. Also called the Military on the Move program, it means a lot to Tom to be a part of it since he is an Air Force veteran and likes to give back.
What happens with the MOM program is that Tom and Cindy give part of their commission back to the veteran. The nicest part of the program, though, is that if they have previously used their VA loan for a rental and are no longer eligible, MOM will still cover them. In fact, it can be used with an FHA or conventional loan as long as the person receiving the money is active or non-active military.
To be eligible for this program, you do have to be lender approved. You may even be eligible if you are a family member to a veteran that needs assistance. To find out your eligibility, you can check with Tom or Cindy.
If you have any additional questions or want to learn more about the MOM program, please feel free to contact Cindy at (916) 715-6899 or email@example.com or Tom at (916) 489-1090 or firstname.lastname@example.org.
And, as always, if you have any mortgage questions, please contact me by phone or email. I look forward to speaking with you soon.