Download - Missouri VA Loan Report 2010
VA Loan ReportMissouri - 2010Realtor’s Edition
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The Veterans Administration now guarantees more than 3,300 loans in Missouri. We will show you how to earn an additional 3-4 deals per year from this group of home buyers with very little effort.
The next few pages provide Realtors with the key basics of VA loans. In less than five minutes, you’ll be prepared to discuss, market and sell like few other agents in Missouri.
The CurrenT LandsCape
On the heels of the subprime collapse, the Department of
Veterans Affairs guaranteed more than $68 billion in single-
family loans for the fiscal year ending Sept. 30, 2009, an 80
percent increase from last year. There are currently more
than 23 million veterans across the country, including almost
530,000 in Missouri.
Against this backdrop, the ranks of registered Realtors are
thinning nationwide. In Missouri, the number of registered
agents has fallen 8 percent since 2007. That shortage
is forcing veterans to spend more time hunting for a
qualified agent than ever before. Realtors who can cater
to this deserving demographic stand to boost their book of
business significantly as veterans return home from Iraq and
Afghanistan in the coming months.
“The one important factor in a VA loan is that once a purchaser is preapproved, you are generally assured that they will have a successful closing because VA does require good credit for a buyer. Another advantage for VA loans is that a vet can use his eligibility more than once.”
Kathy JonesPrudential Patterson
Realtors
By the NumbersMissouri Realtors by Year
40,000
50,000
60,000
48,101
51,56252,322
2007 2008 2009
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Pulaski
St.Francois
Morgan
Camden
Taney
Texas
Howell
Henry
JohnsonCass
JacksonBoone
St. Charles
St. LouisPettis
Stone
Missouri CounTies wiTh highesT perCenTage of VeTerans
Pulaski 27%
Camden 18.5%
Stone 16.1%
Morgan 15.8%
Henry 15.6%
Johnson 15.6%
Taney 15.2%
Texas15.1%
Howell14.9%
Pettis 14.3%
St. Fran-cois14.1%
Cass13.3%
St. Charles 11.2%
St. Louis County 11.2%
Jackson 11.1%
Boone 9.3%
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15.5 to 17.114.0 to 15.412.7 to 13.95.4 to 12.6
The VeteranPopulation2000
Source: U.S. Census Bureau, Census 2000 SummaryFile 3. American Factfinder at fact�nder.census.gov provides census data and mapping tools.
Percent of people,18 years andover, who areveterans by state
18.0 to 39.115.0 to 17.912.7 to 14.98.5 to 12.6Less than 8.5
U.S. percent 12.7
U.S. percent 12.7
0 100 Miles0 100 Miles0 100 Miles
0 100 Miles
Percent of people,18 years andover, who areveterans by county
The BasiCsVA loans are backed by the government, a layer of protection that
often translates to excellent loan terms for qualified veterans.
VA loans can be used for a host of purposes, including:
• To buy, build or refinance an owner-occupied residence
• To refinance an existing VA-guaranteed or direct loan
• To repair, alter or improve a veteran-owned residence
• To simultaneously purchase and improve a home
• To buy a single-family residential unit in a VA-approved
condominium development
• To buy a farm residence owned and occupied by the
veteran
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There are a few limitations on properties that can be financed with
a VA loan. VA loans cannot be used for:
• Land loans
• Investment properties
• Buying or building a combined residential and business
property, unless:
The property is primarily residential, with no more
than one business unit and a nonresidential area
that doesn’t exceed 25 percent of total floor space
• Buying more than one separate residential unit or lot
unless one is owner-occupied and there’s evidence that:
The units are not available separately
The units have a common owner, were considered
one unit in the past or are assessed as one unit
The BenefiTsVA Loans provide qualified veterans with an array of financial
and lifestyle benefits, including:
• Less stringent qualification guidelines
• No down payments
• No private monthly mortgage insurance
• No pre-payment penalties
• Higher allowable debt-to-income ratios than conven-
tional loans
• Sellers can pay up to 6 percent of closing costs and con-
cessions
• Refinance options that do not have credit score re-
quirements and require less stringent underwriting
requirements than traditional refinances.
Agent Reminder:VA Loans come withNO DOWN PAYMENT.
“I love VA loans! It’s a fantastic product for the client. Sellers can contribute up to 4% of the purchase price, there’s no PMI and typically, VA loans have a better interest rate than most conventional, even FHA financing! No money down for the buyer is always great!”
Kelly Sloan, BrokerHome Sweet Home Realty
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Loan LiMiTsThe VA pledges to repay a quarter of the loan amount in the
event of default. The amount of that guarantee has recently
increased, making homeownership more affordable to more
veterans and their families.
Today, the VA will guarantee up to $104,250, which has
boosted loan limits to $417,000 throughout most of the
country. However, there are higher loan limits in some of
the nation’s high-cost areas, such as Hawaii, California and
New York. In these high-cost regions, qualified veterans can
purchase a home worth up to $729,000 without putting down
a single dollar.
funding feeThe Veterans Administration charges a per-person funding fee to help defray program costs. There are exemptions for veterans with service-related disabilities, but generally the fees change depending on the borrower’s military status and down payment.
For regular military, the breakdown is:
Down Payment Funding Fee for First-Time Use
None 2.15 percent
5% or more 1.50 percent
10% or more 1.25 percent
Agent Reminder:Today, the VA will guarantee up to $104,250, which has boosted loan limits to $417,000 throughout most of the country.
“The best feeling as a realtor is watching someone who served our country purchase a home. My experience with VA loans has always been wonderful.”
Brooke Sydenstricker McCarty
Weichert, Realtors
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For cash-out refinancing loans, the funding fee is 2.15 percent for regular military and 2.4 percent for Reserves and National Guard.
appraisaLsEach VA field station sets a maximum appraisal and inspection
fee based on comparable costs. Appraisal costs typically
average about $350. Here is the cost breakdown for Missouri:
Single-Family Home Condo
Condo Manufac-tured Home
Re-Inspection
$300 $325 $225 $65
Manufactured homes are eligible for a 30-year VA loan if:
• It is classified and taxed as real property
• It is property attached to a permanent foundation
• It conforms to applicable building codes and zoning
requirements
Agent Reminder:Appraisal costs typically average about $350.
Down Payment Funding Fee for First-Time Use
None 2.4 percent
5% or more 1.75 percent
10% or more 1.50 percent
For the Reserves and National Guard, the funding fee table is:
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New construction (those less than a year old and never owner-
occupied) is eligible if either:
• Covered by a one-year VA builder’s warranty
• Enrolled in a HUD-accepted 10-year insured protection
plan, or
• Built by a veteran as the general contractor for his or
her own occupancy
There are exceptions for veterans if builders will not provide
a one-year builder’s warranty or a 10-year insured protection
plan.
repayMenT and refinanCe
TThe VA guaranteed more than 144,000 refinances in fiscal
year 2009, a jaw-dropping 300 percent increase from FY 08.
The VA offers flexible refinance options for qualified borrowers.
Veterans can utilize a cash-out refinance to consolidate debt
or refinance to obtain a better interest rate using an Interest
Rate Reduction Loan, better known as a VA Streamline.
Qualified borrowers can’t get cash back with a VA Streamline.
But any out-of-pocket costs can be rolled into the cost of the
new loan – or borrowers can accept a higher interest rate and
allow the lender to cover the costs.
There are also refinance options for veterans with conventional
home loans. Qualified veterans can currently refinance up to
100 percent of their property’s appraised value. Veterans and
their families can also prepay on their loan without financial
penalty.
Qualified borrowers can’t get cash back with a VA Streamline.
But any out-of-pocket costs can be rolled into the cost of the
Agent Reminder:The VA offers flexible refinance options for qualified borrowers.
By the NumbersRefinances
0
30,000
60,000
90,000
120,000
150,000
2008 2009
144,800
37,300
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new loan – or borrowers can accept a higher interest rate and
allow the lender to cover the costs.
There are also refinance options for veterans with conventional
home loans. Qualified veterans can currently refinance up to
100 percent of their property’s appraised value.
good Business for reaLTors and Their CLienTs
Veterans are increasingly turning to the Veterans Admin-
istration when the time comes to purchase or refinance a
home. A roiling national economy and hardened credit market
have only underscored the urgency.
But surprisingly few Realtors have significant experience with
VA loans. Those who can harness the power of this dynamic
and deserving demographic will have a significant advantage
as the agent pool continues to shrink.
VAMortgageCenter.com®PROUD TO SERVE THOSE WHO HAVE SERVED OUR NATION
This guide was produced by VA Mortgage Center.com, America’s #1 VA LoanPurchase Specialists. Founded in 2003, VAMC.com has worked with over500,000 military families and serviced over $1 billion in VA Loans in 2009.
800-405-6682 Licensed Nationwide www.vamortgagecenter.com