VA Loan / Veteran Mortgage News
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SEPTEMBER 2005
VA Business Programs for Veterans
The VA Center for Veterans Enterprise, a sub-division of the Office of Small and Disadvantaged Business Utilization,
was created to make it easier for veterans to establish and expand their businesses. The center was established by the
Veterans Entrepreneurship and Small Business Development Act of 1999, and was officially dedicated February 14, 2001.
The center's mission is to promote veterans' business enterprises.
The 1999 Act includes the creation of a National Veterans Business Development Corporation; establishes a "service-disabled"
category of veterans for federal contracts; sets goals for contracts and sub-contracts given to veterans and service-disabled
veterans for federal contracts; authorizes the Small Business Administration to defer repayment of business loans held by
reservists recalled to active duty; requires VA to notify veterans in business about opportunities to do business with the
federal government; and creates a formal agreement between VA, the Small Business Administration and the Service Corps of
Retired Executives to provide technical and management support to veteran entrepreneurs.
WHAT IS A VETERAN OWNED BUSINESS?
A veteran is a person who served on active duty with the U.S. Army, Air Force, Navy, Marines, or Coast Guard and
who was discharged or released under conditions other than dishonorable. People who were called to active duty,
plus any reservist or National Guardsman who was injured while in training status, also qualify as veterans.
To be considered a veteran-owned business, 51 percent of the ownership and control of the enterprise must be
maintained by veteran(s).
It is estimated that there are 5 million veteran-owned businesses that could benefit from the services provided by the
Center for Veterans Enterprise. The center plans to contact veteran-owned businesses in the United States and register
their services or products with federal procurement offices.
To access the public laws, memoranda of understanding, information about the National Veterans Business Development
Corporation and federal acquisition regulation information, go to the website at
www.vetbiz.va.gov.
LOANS FOR RESERVISTS
The Veterans Entrepreneurship and Small Business Development Act permits emergency lending to business owners who are
members of the Reserves or National Guard when they are called up for active duty. This lending assistance helps
defray bills so their businesses are not damaged while they are away.
How do contractors find a veteran-owned business?
Veterans should register their business on the
Small Business Administration's Pro-Net database.
It is a free service to users. Prime contractors will be directed to the database to locate veteran-owned businesses.
Source: Department of Veterans Affairs
Home Sales Set for Record
Consumers who have purchased houses in recent years have been well rewarded, as rising values show. Yet the primary reason to
buy a house is so you can live where you want, and pursue the lifestyle you enjoy. A home gives you the space to relax with
family and friends, as well as to express yourself. You decide how to decorate and organize your home, and you can change
that as often as you wish!
Make an extra bedroom into an office, exercise room, entertainment center, nursery, or a hobby area. Owning your house
gives you the freedom to go after your dreams. Some areas of the country now are reporting that homes are taking longer
to sell, and that buyers have more properties to consider purchasing. A larger supply of homes could cause prices to
go up at a slower rate in the future. Slower economic growth and rising interest rates also will cool off the real
estate market over the next year, many economists believe. Stepping away from large price increases will create
"a better-balanced marketplace for housing," says David Lereah, chief economist at the National Association
of Realtors.
Shop for Settlement Services
Buying a house is a complicated transaction, involving lots of laws and regulations. That's one reason settlement statements
can be difficult to understand. Each line on the closing statement represents a completed task, and shows what is charged
for that service. Yet it's hard for consumers to compare closing costs when shopping for a home loan. Lenders can differ
in what they call various charges. And at times consumers find that costs which weren't mentioned
earlier show up when it's time to sign the final papers.
CUT COSTS
We'll go over your closing costs right when you apply for a loan, and let you know immediately if there will be changes
to those estimates. Additionally, we'll explain what each cost is for, to eliminate any misunderstandings. More importantly,
we'll show you ways of lowering your housing costs which can't be found on the settlement statement. Every loan has trade-offs
which must be balanced against each other, and we'll let you see how that works in your situation.
Everyone's situation is different. How long you plan on staying in the house and expected changes in your income and
expenses are just as important as your initial monthly payment.
A WINNING PLAN
Someone with little savings who also knows they'll move within five or six years can benefit from a loan requiring little
or no cash at closing. Those costs are covered by adding them on to the loan balance or charging a slightly-higher rate.
Buyers find their monthly payments are a little higher as a result, but they can get into a nice house without
writing a big check upfront. However, buyers who plan to stay in that residence for decades will find the higher
monthly payments adding up over time. Finding a mortgage that suits your needs - both now and in the future - is
our strength. Let us show you ways to keep your housing costs within your budget.
Avoid Home Loan Scams
The National Consumer Law Center recently raised alarms about "the rampant theft of Americans homes," reports The Washington
Post. Con artists across the country will offer to help owners who have fallen behind on their payments.
Many of these scam artists find their victims by putting fliers in mailboxes, porches, and on telephone poles.
Usually their goal is to acquire the house for themselves, critics say.
Owners who contact scam artists are pressured to take action without consulting a lawyer or lender. Often the house is
worth more than the owner is aware, and the "rescue specialist" will offer to buy it at a discount, in order to
pay off the loan. A rescuer may agree to rent the house back to the current owner, but typically soon evicts them.
At that point the former owners may find the rescuer didn't even pay off their mortgage, so they still owe on
their original home loan.
BETTER CHOICE
No responsible lender wants to take a homeowner's house. Owners who have experienced financial setbacks generally can
talk with the company who receives their monthly payments, and come up with a revised payback schedule.
Knowing who you're working with is critically important on real estate matters. And always make sure you
understand any legal documents before signing them.
Today's Hot Home Trends
Home builders and architects try to keep up with changing consumer desires about house features. One trend is that new
American homes have ceased getting larger. Today an average new house has four bedrooms and two bathrooms in 2,400 square
feet of living space. That's more than twice the size of an average home in 1950. Yet buyers are starting to favor
special electronics and other features over having another bedroom. Today homes can be wired throughout for phone,
Internet, audio and video, as well as a security system.
ROOM TO RELAX
Formal dining and living rooms are less in demand now. Today's buyers prefer informal spaces that can adapt to their
household's needs. Owners also are looking to the future, by asking for features that will make it easier to live in a
house as they grow older. More emphasis on the outside of homes is seen now. Even though lots are getting smaller,
homeowners are improving their landscaping and adding amenities that make entertaining and relaxing outdoors easier.
Finding a house that's right for you starts by deciding on your priorities. And obtaining financing that works for you is just
as important as locating a house that you'll love. Call us to discover how you can purchase a house that suits your needs,
without stretching your finances. Well go over how different loans can enable you to buy a great home soon.
How to Hold Title
Ownership rights and responsibilities - including the distribution of sales profits and property tax bills - are
determined by how a property's title is held. Title also affects how the property passes to the owner's heirs.
It's advisable to talk with an attorney or accountant before deciding how to hold real estate title. Here are some
overall guidelines to consider as well:
- Divorce situations can cause title complications, since a married couple typically will own the home together. A spouse who
has moved out still is liable for making mortgage payments, so it can be best to refinance the loan so that title is held
just by the former spouse still living there. Couples who don't refi also may have to split profits when the house is sold,
unless one previously has bought out the other's interest.
- At times owners want to add someone to their title, giving them a share of ownership. Parents may want to do so if an
adult child is living with them. Or a single person may put a partner on their title. However, it's best to talk with an
attorney before doing so to make sure you understand all the tax and control ramifications.
- Living trusts can let homeowners pass their property to heirs without going through the probate process. Additionally,
they can allow one spouse to sell a home by themselves if their partner becomes incapacitated.
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