– Are you a veteran or
active service member, and you're thinking about
using your VA eligibility to purchase a home? Well, in this video, I'm going to introduce Becky Hughes, the newest member of our team. She's actually the VA queen if you check her out on social media, so make sure you look her up. She's going to be sharing with you five things that you need
to know about VA loans. Becky, thanks so much
for hopping on with us. – Of course! – Can you share with the people why you love VA loans so much? – VA loans are very special to me because I got into the mortgage business when my husband retired
from the Air Force in 2016, and he became a veteran, and he said to me, why don't you become a mortgage officer? And I said, well, why
not? Let's give it a try.
And I started the business, and absolutely loved helping veterans because I found that,
I knew their language. I knew what they were going through, and I knew how to help them in
a way that nobody else could. – Isn't it true that a
lot of veterans they're pretty unfamiliar with the
entire process in itself, and how to use their eligibility, right? – Yes. It's very common because you know, a lot of them are using
their – they're first time, they're buying their
home for the first time. They are young. They're moving out away from home at 18, and have no idea what they're doing. – Yeah.
– So it's, I love that part of the
job especially because I can guide them, treat them with respect that they deserve, and get them into the right
programs that they need, and do what's best for their interests and not just trying to close a loan.
– Awesome, awesome. So Becky, give us the five
things that we need to know, and that all of our viewers, and especially those
that are again, active, active service members and you know, those veterans out there that maybe not, they don't know too much about the VA loan that we can share with them
and help them out today. – So, a VA loan is a
government backed loan, and it offers highly competitive rates. And you have a chance to get approved with lower FICO scores. Usually it's anywhere between 580 to 620, and there's no down payments. There is was a called a funding fee, and this is the way that the, VA, the veterans department
guarantees the loan.
The funding fee is sometimes waived if the veteran is disabled, or has received the Purple Heart. – Gotcha. And that's any sort of benefits, right? VA, they don't have to be a
hundred percent disabled, right? – No, no.
– They can have a portion or anything, right?
– If they're receiving any percentage of disability a month, that funding fee is waived.
– That goes away… yup. – Yes. And it will save thousands. Number two, you can get approved with a
lower FICO score on VA loans.
Typically, starting at 580 to 620, whereas conventional, it's 620 to 640. – Gotcha. – And also it's a, you can get approved at the higher DTI, which is the debt-to-income ratio. – I think that's one of
the bigger factors, right? That a lot of people have a
misconception on thinking that, I know there's a lot of
myths and stuff online that you guys might be reading and seeing, you have to be at a 41%
debt-to-income ratio, or 43. On FHA and VA loans, you can actually get, go to a higher DTI. – Correct. – So that's why it's super important when you're working with a lender to make sure that they
understand how to calculate your debt-to-income ratio, because there's little things
like that I've overcome in the years that I've been doing this, where I've talked to people and they said, well, this lender can't qualify me because I am at a 45% debt, DTI.
They come over to us and you know, they're doing a VA loan, and we can actually exceed
50% sometimes, right? – Yes. I've seen up to 70% sometimes. – Yeah.
– Which is shocking, but. – So make sure you get with someone who understands how to
structure your deals, because that could be
literally a make or break thing in between you buying a home and renting. And number three, Becky,
what do you got for us? – Number three, no down payment.
This is the most important thing. You can get approved and buy a home with a zero down payment, but, you still are
required to play closing, pay closing costs. – And of course the Realtor can always negotiate
that for you, correct? – Correct! Or there is also down
payment assistance programs that help with veterans, to help pay their entire closing costs. And sometimes they can even
get their EMD refunded, their earnest money deposit. – Absolutely. And that's one thing I also
want to point out too, is, you know, with as competitive
as the market is right now, I hear listing agents sometimes with, this just drives me crazy,
thinking that VA loans are bad or they're weak…
– Correct.
– …because it's a no money down loan. – Correct. They don't think the veteran
has any teeth in the game. – Yeah! And it has nothing to do with the strength of the client. It's the fact that they earn
the right to use that loan, right? And we've qualified them to where they can actually purchase. – Correct! Yeah. And sometimes them not
paying that down payment is actually a better offer because they may have
money now put aside to pay over appraisal value,
or to come out of pocket and purchase the price, you know, up the end, up the purchase price.
– Get a lit, you get a
little more flexibility for how they can structure
the deal. That's awesome. – Okay. So here was a story, I
was at an open house one time and a veteran walked in, and he was stating that
he was going to use, he was not going to use his VA benefits because he didn't want
to pay his funding fee. Well, I stayed in touch with him, and I showed him the benefits, because he was going to go conventional, and he was going to put more money down. And I said, well, you're
already putting money down with the conventional. I said, if you put a
little bit more money down, it'll cut your funding fee. And the whole time he
wanted to go conventional, because he thought that was
the best option for him. And I saved him money by, monthly on his, because again, you get
a lower interest rate with VA most of the time.
And he lowered his funding fee. So it just, I had to educate the borrower. And a lot of the times
it's because the veterans, they don't know.
– Right. – And the lenders they're
working with don't know either. – Yup.
– So… – And I think that just goes
back to a lot of, you know, my pulse, and some of you
that had been watching me for a while. We always talk about strategy. It's not always the interest rate. It's not always what, maybe even you perceive as
a good deal to yourself. If the lender that you're working with isn't showing you at least
two to three other options. And I think for us, that's one thing here at loanDepot, with a lot of our team, we always go through those
options with our clients because you might think that conventional
deal's the best deal.
Right? But, hey, you could actually show
them a side by side that this… VA offer is
actually better for them. – Yeah, it's better payment
or a better down, you know, closing costs, whatever there, you just have to speak
to them and figure out what is their end, what's the
best goal for them at the end. – Yeah. That's awesome. – So number four, the funding fee. You hear talk, you hear
about it a lot with VA loans. – All the time. A lot of
people complain about it. – Yeah, well, it's basically
the same thing as FHA, 3.5% down but instead, it's now placed into the back of the loan. And it's… something you also have to consider in when you're buying a home, because it's added to
the total purchase price over the purchase price of the home.
So you're already exceeding
market value sometimes with your VA loan. And the only way, again, to avoid that is if you put a 5% or 10% down, which lowers the funding fee. – Got it. Or… if you have any sort of
service connected disability, right?
– Correct. – Then you don't even
have to worry about that. – Yup, or you're a Purple Heart
recipient, then it's waived. – So guys, again, run the numbers. This is what I stress in so many of the videos
that we do because, a lot of times you might hate the thought of the funding fee. But if you don't know how it
actually works out on paper, it's hard to make that decision. And again, we compare it to
an FHA loan where the upfront mortgage insurance is
financed into the loan. Remember, you're not necessarily
having to come out of pocket with that money, it's
financed into your loan because there's such a low down payment that's going along with
the, with the mortgage.
So that's the trade-off. – This is how the V,
the veterans department keeps the option for veterans
to purchase their home. That's how they guarantee the loan and help with future losses of veterans foreclosing on their home. It's a cost we got to pay but, it helps with no down payment. – No down payment.
– Yeah. (chuckles) – You can't beat that to own a home! – Exactly!
– It's insane! – So number five, what is our last thing that everyone needs to know about the VA loans? – Oh, there's so many misconceptions as to what you can and
can't do as a V, a veteran. You can have two veterans on one loan using dual entitlement. You can have one veteran
and a non-spouse on a loan. A lot of people don't think you
can do this. It is possible, but the non-spouse, the non-veteran will be
required to pay their portion. So there's numbers that are in play, but it is possible. You can have two VA loans at once.
You could have multiple, As long as your entitlement is remaining to cover the next home. You can have… a energy efficient mortgage. You can have a rental mortgage, which I don't, can't go into yet, I… I will be learning more and
this will be my next thing. – That's a renovation loan.
Just so you guys know, we actually have that
program here at loanDepot, where you can actually
finance the cost of repairs and renovation work into
your mortgage upfront. – And close and have all
the repairs done after. I'm learning more, and this will be, I will be the Las Vegas VA
rental queen (Sean chuckles) after this. Other varieties of loans, they're just, there's so many, there's so many options. – Can you go up to a million
dollars? (indistinct) – Yes. There is no max, there is no max as long
as you can get qualified to purchase a VA loan. There is no max. That, which is another misconception they think that there's
county limits and…
No, there is not. It's just, there's so many different ways to structure a VA loan. And that's, I love learning about the different ways that we can support the veteran and, and make their needs… Oh, here's another one
that I was just learning. So… when you work with
lenders that don't know, like right now, I'm working with a gentleman who purchased a home with his brother in California. And they went conventional
because they were told they couldn't use his entitlement. They could not do the non-veteran with the, the veteran. Well, he now has, we're refinancing
him out of this VA loan. So he can purchase a home here, and use up his whole
entitlement in Las Vegas. – Gotcha. – But, again, they weren't told when they started this process
that they could go vet, VA. – Yeah. So a lot of misconceptions guys, if you're watching this, and again, if you've heard something that conflicts with what we're telling you, by all means, reach out to us.
This is the only way we can help you. You can always send me an email below. I can get you in touch with Becky. She can answer your questions. We're here for you guys. We want to make sure you
get the right information. So you can take advantage
of the low interest rates that we're seeing right now. And the ability to purchase
a home with no money down.
– Yes! Build wealth as a veteran. Real estate.
– So there you have it. Five things that you guys need
to know about the VA loan. Again, thanks so much for watching. If you have questions, send me an email, I'd be happy
to help you guys out with your VA questions or any
loan question for that matter. And of course, we always appreciate you watching, subscribing to the channel,.
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