Questions About Your VA Benefits?

I can't count the number of times I've been working with someone who says, "Oh, yeah, I'm prequalified, got my letter from the VA right here." I work a lot with first time homebuyers and more specifically, military personnel. I live near a large army post, it's the reason our market stays strong. However, I find that many of these young soldiers are not properly educated on how to use their VA benefits to purchase a home. Here are a few key things to know when buying a house using a VA loan.

Just because the VA says you're eligible, doesn't mean you can get a VA Mortgage Loan

If you've never paid a bill on time in your life, you probably can't get a VA Mortgage Loan. Your loan still comes from a bank, so you have to have good credit. As of today the minimum credit score to get a loan is 620, through most lenders. If your credit was bad a while ago and you know you've been making strides, call a local lender and have them pull your credit. Also, be sure you're talking to a mortgage lender. Mortgage laws are constantly changing and if you're talking to someone who does consumer loans, i.e. cars, credit cards, personal loans, etc-they probably aren't up to date on the most current mortgage guidelines.

VA Funding Fee

The VA Funding fee is the way the government reduces the cost to taxpayers. You pay one lump sum up front rather than paying monthly mortgage insurance to a third party. Currently, the amount is 2.15% of the loan amount for your first VA home purchase. Most people choose to have this financed into the loan. Basically, this means instead of financing $100,000 for a home that's $100,000, you would be financing $102,150. The percentage of the VA funding fee goes up with each additional home purchased. So if you're using your VA benefits for the second time, be sure to ask how much the funding fee is.

Price Limits For Using a VA Loan

The biggest misconception comes from people who are using their VA benefits for the second time. Many agents don't even know this. If you have already purchased one home using your VA benefits and are planning to use a VA loan again to purchase your second home, the second home has to be at least $144,000. In most places, the maximum amount for a VA Loan is $417,000; however, this can be higher in certain areas. You can click here for a list of the higher limit counties.

Type of Home Eligible

What? Home eligibility? So not only do I have to be eligible, the house I'm buying does too? That's right, Chief. The Department of Veterans Affairs is there to look out for those who have looked out for us. What that means is, they don't want you buying just any ol' shack that's going to fall down as soon as you sign the paperwork. In order for a house to be VA Eligible, it has to meet a higher standard. The VA sets these guidelines and then a VA certified appraiser comes out to verify that the home meets them.

Now that you're a little bit more informed, happy home hunting. I am not a lender, VA representative or an expert on this subject. All information contained above, can be found in a much more to the point, aka boring, format by visiting VA.gov

Low Rates Keeping Clarksville Market Steady

Rates and Number of Homes Sold

With the recent deployments at Ft Campbell and the expiration of the Homebuyer's Tax Credit, everyone fears the market is slowing. With interest rates holding steady below 5% and today's rate an amazing 4.750% on a 30 year Conventional loan and 4.250% on a 30 year VA or FHA loan, houses are still moving. Currently, there are 1923 homes for sale in Montgomery county. To date this month, we have closed 64 houses and have 300 houses in pending status.

In the month of June, 296 homes closed in Montgomery county compared to 343 homes closed in June of 2009. Although the number is slightly lower than last year, it's no reason to panic. The average time on market for homes in June of this year is only 77 days versus 94 days on market in June 2009. So for all the doubters out there, our market is still strong.

Let's talk about price

The average sold price of a home in Montgomery County during June 2010 is $167832. The reports also show that the average seller got 98.3% of their asking price. That's great for sellers! Compare these finding to June 2009 and you'll see that our homes are still gaining in value. In June 2009, the average sold price was only $148063. Sellers were averaging 97.26% of their asking price.

All market data supports that Clarksville is a great market to be in. Whether you're an agent like me, an investor or someone relocating to the area.

Source: Realtracs Solutions, Brentwood, TN