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[VA Loan] Home Loan (VA LOAN Requirements) Mortgage (VA LOANS) VA Loans what you need to know! - YouTube
Channel: Fire Your Landlord
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Hey this is Chris the mortgage Pro. I'm
gonna introduce you to what is a VA loan,
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how does it work, and 20 things you must
know about a VA loan. Now any time
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throughout the video please like, share and
comment because I answer every question
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personally. And thank you for your
service.
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number one, if you have an honorable
discharge or a general discharge A
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general discharge basically is somebody,
sometimes the military for one reason or
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another just lets you go early you
didn't do anything wrong
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but with a general discharge you can
also get a VA loan. If you have a less
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than honorable discharge
you would not be entitled. Number two.
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DD-214, I need your DD-214 and what I'm
gonna do is I'm gonna take that send it
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to the VA and I'm gonna get what's
called your Certificate of Eligibility
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that's gonna tell us how much you're
entitled to for a VA loan. Number three
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people often think I can only have one
VA loan at a time. Well, that's not true
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either. If the VA loan that you might
currently have is for a small amount you
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have an added eligibility you're not
going to be able to buy too expensive
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homes with the VA but very often I see
people with two VA loans at the same
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time. Number four, maximum loan amount. Well,
first of all you can get a loan for a
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million dollars with a VA loan, how does
that work?
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aren't there limits? Well, kind of what
happens is the VA is going to guarantee
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25% of the loan. Now if the limit is $453,100
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that's what it is right here in
San Bernardino County California if you
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want a house a hundred $100,000 more, $553,100
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you'd be required
to put as a downpayment
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25% of that amount so 25% over a $100,000 you put
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a $25,000 now if
you want a million-dollar home you just
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put 25% of the amount over the
$453,100
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now in every county in the
country the loan amounts are different
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the limits are different so you'd have
to check with you a county or you can
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reach out to me and I'd be happy to
figure out wherever you are in the
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country and tell you exactly what the
limit is. Number five down payment. Now I
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just mentioned in the last one if you go
over the limit
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you have to put 25% of the amount over
the limit for your County down otherwise
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it is a zero down payment loan. That's a
big deal where else you gonna get a zero
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down payment loan with the lowest
interest rate. Number six a funding fee
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now how a VA loan works is there is a
funding fee the first time you use it
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it's 2.15% of the
purchase price so as an example a
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$200,000 loan 2.15% is $43,000
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if you use it for the first time
they're gonna add $4,300
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to the loan amount if you do it
the second time we're looking at
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3.3% so that would be
$6,600 added to your
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loan amount. Now there is one gotcha one
stipulation here one thing that's really
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really great is if you are a disabled
vet what happens is that funding fee is
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a 100% waived doesn't exist
you don't pay it. Number seven, FICO score
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FICO stands for Fair Isaac's Corporation
basically it's your credit score now
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with a VA loan some lenders all have
different numbers I do as low as a 554
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in order to help you get approved with
zero down now the higher the FICO score
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the more you save and fees and on
interest rate so we always want to take
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a look and see if we can raise your
score easily and quickly in order to
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save you that extra money however very
often with a 555 go score I could get
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people approved
number eight if we know what the FICO
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score is and we know what we have to do
we know what the approximate purchase
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price is we know what the approximate
payment is we're gonna do what's called
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a pre-approval now many people hear of
it it's not a pre-qualification a
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pre-qualification says you told me the
information verbally over the phone and
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I've been doing this for so long I know
if you've been approved or not but
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that's just a pre-qualification a
pre-approval requires me looking at all
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your documentation and I'm going to talk
about the documentation
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a minute or two but I'm gonna look at
all your documentation I'm gonna make
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sure your income is there I'm gonna make
sure your assets are there your FICO
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score is there your dd-214 all the
pieces the Certificate of Eligibility
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we're gonna put all those pieces
together we're gonna evaluate them now
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after all these years I could pretty
much do it standing on my head I know
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exactly what we need to do but I take it
to the next step what I'm actually gonna
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do is I'm gonna take those documents and
I'm gonna number one I'm gonna
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computerize them I'm gonna put them into
the system I'm gonna let the computer
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run your numbers and what's gonna happen
is we hope to get an approval and
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basically it'll come back saying approve
eligible that means you're approved
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you're eligible we do have to verify
every little dot every I and cross every
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T now once in a while it doesn't come
back approve eligible it may say refer
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eligible and that's usually when the
income is either a little tighter or the
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credit score is lower on the five fifty
five eighty and under range so it
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happens all the time and what we do that
point is we are allowed to do what's
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called a manual on the right instead of
the computer underwriting we can send it
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to an underwriter who's gonna evaluate
all the numbers crunch the numbers and
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say does this meet VA guidelines for a
VA loan and very very often we still get
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you approved number nine we have you
approved the next step is an agent real
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estate agent is gonna take you out and
show you properties maybe you've already
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seen a property maybe you haven't maybe
you have an agent if you don't I know
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all the top-notch aides in the area who
are gonna help you take it to the next
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level show you the houses show you what
you are interested in you're gonna tell
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them you know I'm looking for this many
bedrooms this many bathrooms in this
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area this is what I'm the School
District I want I want to pull whatever
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it is their job is to find that house
and represent you number 10 we get an
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offer accept that means the real estate
agent who listed the house has presented
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your offer your price and your
firms to the seller and the seller has
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accepted the terms now we're gonna do
what we call opening up escrow we're
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ready to start the ball moving number
eleven disclosures we are going to
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disclose all the financial numbers to
you sometimes this takes a day or two
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because there's a lot of numbers every
fee every everything has to be covered
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we have to figure out where is this
coming from how much is it gonna cost
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you maybe nothing
so we're gonna talk about that later too
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number twelve the appraisal we're not
allowed to order the appraisal until the
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disclosures that I just talked about are
signed once they're signed we have to
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order the appraisal on a VA loan through
the VA portal and the VA is going to
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assign an appraiser they randomly will
pick an appraiser we're not allowed to
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call them up hey Harry I want you to go
do John's afraid it doesn't work that
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way we have to do this randomly and
through the VA portal they're gonna
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order the appraisal which takes usually
about a week or so they're gonna go
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visit the property they're gonna look at
every little instance every little thing
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they're gonna take pictures of the house
make sure it's safe they're gonna look
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at all different things to make sure and
value they're gonna show us what the
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value that they figure is they're gonna
say okay here's a comparable home three
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blocks away
here's another comparable home a half a
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mile away that sold three months ago and
here's one right down the block
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well this was the square footage here
this is the square footage on this house
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and they're gonna compare they're gonna
crunch all the numbers we don't get
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involved in that but it's gonna come
back and say this is the value of the
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house we do that to ensure a couple of
things one the lender wants to be sure
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that they're lending you money for a
house that's worth what they're lending
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you number two we also want to protect
you because what if you offer $300,000
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for a house but it's only worth 275 that
wouldn't make any sense for you so it's
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there to protect you and there to
protect the lender number 13 income we
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need documental provable income if you
can't prove it on paper it doesn't exist
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if you started working
job last week a second job just because
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he did that doesn't mean we can use the
income we can use one job and all the
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income or two jobs if he'd been working
that job for two years so a lot of
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people try and buy a house so they just
we started three months ago well that's
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great that you save some extra money but
we can't use that income now how do we
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determine income super important are you
paid how early are you paid salary
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salary is easy you could pay $5,000 a
month you $5,000 a month but if you get
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paid twenty dollars an hour okay how
many hours do you work a 40-hour
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workweek
or do you work a fifty hour work week
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well we're gonna use the 40-hour work
week and the rest is going to be
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overtime how we use over time is we
average it over the last two years
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because if you started working overtime
six weeks ago we can't use that also
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bonuses and Commission we have to
average those also see it can't be brand
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new income with no history they need to
see a history to determine can you
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really afford this if you're a disabled
vet and you receive disability income
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from the VA what happens is we can gross
that up 25% let me explain if you are
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let's say a 50% disabled then you're
getting roughly $1,000 a month we get to
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add 25% of that so it's one thousand two
hundred and fifty dollars as your income
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why can we do that well you don't pay
taxes on that money so that's a big deal
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we evaluate your income taxes the family
not just yours if if your wife or a
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husband is going on the loan with you we
can use both incomes but only a husband
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and wife can go on the same va loan or
to veterans as an example you cannot
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have a fiance and and the veteran it
just doesn't work that way they must be
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married or both of them would have to be
veterans true story I once went to a
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wedding where I did a loan for my
friends they wanted to buy this house
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but they weren't married yet so what I
did was I told them you have to be
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married if you're going to
this house cuz you need both incomes I
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went to their weddings six months later
and my wife and I were the only people
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there who knew they've been married for
six months number fourteen documentation
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super important you know but most people
it's pretty straightforward if it's a VA
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loan we always start the most important
documents to start with is we need your
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dd-214
we start there we're gonna order your
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Certificate of Eligibility so you don't
have to next we're gonna look at your
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income we need one month's pay stubs if
your spouse is also on the loan one
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month obviously for both if you have
jobs we also need two years of income
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taxes and two years of w-2s
very often when we run the approval it
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will not require income taxes but we do
ask for them upfront because in most
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cases it will we're also going to ask
you for two months of bank statements
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every single page please don't blacken
everything out they won't accept that we
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need two months of bank statements we
need a social security card and a
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driver's license now if you have a 401k
or you have some kind of other income or
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documentation for savings of some kind
whether it's retirement savings or
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whatever it just makes you a case
stronger so give us that too if you've
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had a bankruptcy in the recent past
we're gonna need bankruptcy
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documentation also so these things
change with everybody everybody like a
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fingerprint has a little bit of a
different situation so we stop there and
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then the underwriter is gonna ask for a
little bit more a little bit more to
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prove little things sometimes a little
can of worms opened up with a deposit
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that you made or something so they're
always gonna ask for more
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get used to it that's how it works
number fifteen termite report you know
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with an FHA loan conventional loans
other types of loans we very often do
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not need a termite report on a VA loan
it is mandatory every single time they
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are meant to protect you as the consumer
you as the veteran who's buying this
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home they want to make sure you don't
have a ton of termite damage or even a
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little termite damage that we don't want
you to be responsible for now
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4:16 it's starting to get exciting now
you're finding the house that you're
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looking for we've gone through the
pre-approval process we ordered the
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appraisal we ordered the termite it goes
to the underwriter and the underwriter
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reviews all the documents and we get the
approval and that is one of the most
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exciting things we're at the stage where
we have the approval now what happens is
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they're always going to say I need this
other piece of documentation or that
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piece of documentation that is very
normal stuff but at least we know this
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is exactly what we need to get you in
your own home
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number 17 you meet those conditions the
conditions that the underwriter asked
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for he may say let me see the homeowners
insurance or I don't like this or I
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don't like that let me just prove that
you give us all those conditions
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hopefully you gave it to us very quickly
because the quicker you give us the
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documents the quicker we close your loan
number 18 closing disclosures these are
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the final numbers that is going to be
used for the closing it's gonna say this
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is your interest rate this is what this
cost this is what that cost there's a
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lot of different ways to do this but
these are the final numbers if you have
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to come in with any money and we're
still going to talk about if you do or
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not this is how it works they're gonna
give you the final numbers number 19
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along the way there were a couple of
things that have happened one is you
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know that you had usually a zero down
payment loan with the VA however there
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are still closing costs now there are
three ways to pay closing costs one is
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we ask the seller to pay and sometimes
we do get them to pay and sometimes you
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ask them for $8,000 for closing costs
and they say we're gonna pay 3,000 so
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it's a negotiation back and forth
sometimes you pay you can pay the rest
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or sometimes I can raise the interest
rate up just a little bit and by doing
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that I get what's called the lender
credit and we could apply that to
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closing costs now sometimes the seller
says I'll pay three we raise the
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interest rate a little bit we get $3,000
in the lender
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it and you pay two thousand dollars out
of your pocket see could be any
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combination of those things but this is
how a VA loan works yes zero down
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payment but somebody's still got to pay
those closing costs number twenty you
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sign the documents you sign the
documents you and whoever is on title
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your spouse or whoever it is you sign
the documents and then usually sometimes
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the same day if it's done real early or
the next day we fund the loan that means
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the money has been wired to pay off your
the other loan to pay off the purchase
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and now the house is yours with one
small exception the county has to record
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it once they put their stamp of approval
it is recorded with the county you have
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successfully after 20 steps fired your
landlord
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