Purchasing a Home with a VA Loan- Challenges and Opportunities

VA loans are hands down the best loans out there for opening doors with low purchase costs and payments.  You can purchase a home with no down payment. If your Realtor writes the contract correctly, you can often get a credit for closing costs also. So there is the opportunity.

Here are the challenges...The VA will only guarantee loans for homes that are in very good condition. Forget about fixer uppers. The way this works is that the VA appraiser "calls out" condition items that are not acceptable. Either the seller pays for repairs or the sale cancels. If the repairs are minimal, sellers are often prepared to pay. Unfortunately if the repairs are significant, sellers will often look for a buyer with conventional financing. This eliminates the need for repairs to satisfy the lender (with some exceptions).  So in a situation with a new listing or a multiple offer scenario, it can be difficult to buy an older home with a VA loan.

Here is my advice (from over 35 years as a Real Estate Broker). You and your Realtor can first look at available homes in good condition. After that, take a second look at homes in okay condition that have been on the market for over 40 days or so. The sellers of those homes may be more flexible about repairs once their home has been on the market for awhile. I recently closed a sale for a VA buyer under just such a scenario. The seller was resistant to making repairs however time on the market caused her to choose that path. I have also been involved in purchases where the sellers specifically selected an offer with a VA buyer. That's a rewarding transaction, when Veterans are acknowledged for their service with a true Welcome Home statement like that!

If you are a Veteran, you should definitely look into getting your Certificate of Eligibility so you can purchase a home. A local lender who specializes in VA loans can assist you in getting the certificate. It can save you some time. It's a good idea for you to check eligibility though. Here is that information on the eBenefits website benefits.va.gov_homeloans_eligibility

If you do not yet have a Realtor, consider looking for a Military Relocation Professional. Here is a web page where you can search for your Realtor - Military Relocation Professionals-find-mrp

If you are looking for a Military relocation Professional or just a great Realtor in the greater Sacramento area, please contact me! (916) 837-4500 or Pamela@ask-Pamela.com