VA Loan / Veteran Mortgage News
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JULY 2009
Quick Facts for Veteran Home Purchases
The Department of Veterans Affairs Home Loan Guaranty Services website has many helpful pieces of information that can assist Veteran homebuyers utilize their eligibility towards a home loan. Other than the $0 down payment available to eligible veterans, here are some other good reasons to use your VA loan.
- The veteran does have to occupy the home as their primary residence.
- The veteran does have to qualify income and credit wise.
- VA does not have a maximum loan amount. However, lenders do sell loans on the secondary mortgage market, so they will generally limit loans to the VA limit for the county where the property is located. With a down payment, loans may exceed these amounts.
- The veteran does not have to be a first time home buyer and may reuse his/her benefit.
- There is no private mortgage insurance, but VA does charge an up front VA funding fee, which may be financed. The exception to this is that if a veteran is in receipt of VA service connect disability payments each month, he or she does not have to pay a VA funding fee.
- The lender, not VA, sets the interest rate and discount points, so they may vary from lender to lender.
- The seller can pay for closing costs.
Source: http://www.homeloans.va.gov/lp.htm
We See a Better Future
A poll released this summer shows that more than three out of five Americans expect their money situation to get better over the next twelve months. "The public is increasingly optimistic that the nation’s economy will improve in the next year," notes the Pew Research Center.
Despite this optimism, most of us say we’re reducing non-essential expenses. Many have pared back their vacation plans, and we’re barbecuing in the backyard rather than going out to eat on weekends. Most are cutting back in order to be prepared if their finances get tighter. Just a little more than one in three report they are spending less because their circumstances already have deteriorated.
Americans generally have managed their personal finances well, and are taking smart steps now to handle tomorrow’s challenges. For that reason, a big part of our job is to ensure your mortgage payments fit into your budget. When you’re considering refinancing or thinking about buying a home, contact us first. We’ll go over your goals, and help you map out a plan to reach them.
We’re in new financial times. But Americans keep finding opportunity in real estate, and continue drawing great enjoyment from living in their own homes. In the past we’ve made financial sacrifices so we can buy houses. Let us show you now how it’s possible to make a purchase you’ll benefit from for years.
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Your First Home Purchase
Moving into your own home is a big step in many ways. It’s a huge source of pride, since you can make your house into the living space you’ve always wanted. Your home can become a place which nurtures your aspirations, and provides the atmosphere you need to pursue them.
Owners find their lives changing in positive ways after purchasing a residence. Choosing the neighborhood you prefer allows a move to start a new chapter in your life. You’ll gain tax benefits by deducting the cost of mortgage interest and property tax payments. Many owners also can write off the expense of mortgage insurance premiums. Properties tend to rise in value over time, as well. Yet owners can avoid tax on up to $500,000 in profits when selling.
Time to Act
Right now first-time purchasers can reduce their taxes immediately by $8,000, due to a temporary tax credit. Anyone who hasn’t owned their residence for the past three years can take advantage of this opportunity. But the $8,000 tax credit for first-time buyers is scheduled to lapse at the end of November 2009. Get in touch with us for full information on this special benefit.
Some first-time purchasers are using the tax credit to allow them to renovate their new home. Others are finding it frees up funds which make it possible to buy now. First-time purchasers will gain a great place to live today, and they also can expect to see their home increase in value over time. One reason is that demand for housing will be healthy in coming years.
Children of baby boomers – or “Echo Boomers” – actually outnumber their parents, notes Harvard University’s Joint Center for Housing Studies. “The record size of the echo-boom generation now reaching young adulthood,” it adds, will soon provide a big boost to real estate sales as they purchase their first homes.
“The aging of the echo-boom generation will help to fuel household growth and undergird (housing) demand,” the Joint Center says.
Owners never forget their first house – the space it gave them, who their new neighbors were, and the improvements they made over time. Having a place of your own also makes it easier to move up in the future as your living needs and preferences change. Ask us for the names and phone numbers of households similar to yours who we’ve helped make an important first-time home purchase. After answering all your questions, we’ll guide you through a successful buying process.
Rates Still a Bargain
Mortgage rates continue to fluctuate, but remain at attractive levels. Earlier this summer rates on 30-year home loans were more than one percent lower than they were a year ago. And that translates into a monthly savings of $165 on a $250,000 mortgage. Over a year you’d save almost $2,000 simply because rates are lower than they were in 2008. Obtaining a low fixed rate allows you to purchase a home or refinance your existing loan with confidence. You’ll then know your payments won’t change in the future. Talk with us to learn more about the positive options available now. We’ll go over how different mortgages would fit into your budget, so you can make an informed choice.
Housing Market Strengthens
More economists are forecasting a healthier housing market in the near future. Recently Yale University economist Robert Shiller – who tracks housing prices nationally – said that property values may have reached a bottom. House prices rose this spring in almost half the cities followed by the Case-Shiller housing index. “I was quite taken aback” at seeing home price increases, adds Case-Shiller index co-founder Karl Case.
“There’s been a change in mood” in the market, he notes. “My guess would be that home prices are going to level off,” Shiller adds.
Property values fluctuate in different areas due to employment rates and other factors. Yet seeing some strength in real estate nationally shows that now could be a great time to look into making a home purchase.
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