San Diego home sellers and their real estate agents should be aware of the positive rule changes with San Diego VA loans. Many people don’t know that in the past VA loans were not as good as conventional loans because the San Diego seller had to pay a large amount of fees known as the VA non-allowables. Naturally San Diego home sellers and their agents didn’t like VA loans because the seller ultimately had less proceed from the San Diego house sale in comparison to a conventional offer where the San Diego homebuyer could pay their own closing costs. And, this can be up to 3% of the purchase price! If you do the match on a San Diego house that is selling for $400,000, it could be a whopping $12,000.
The great news is that today VA loans closing costs are not automatically a burden on the San Diego home seller. The change is that it’s not that the San Diego seller has to pay VA non-allowables; it’s just that the San Diego VA buyer cannot pay VA non-allowables. Huh?
Mortgage lenders today, routinely structure the VA loan so that Fannie Mae pays the VA non-allowables. How do they do that? They build the charges into the loan – they simply add it to the loan. And since there are no borrower funds to source and season (checking the San Diego homebuyer’s bank accounts to verify the funds have been there for a while), the whole loan is really just about income and credit scores. After explaining all of this to the San Diego seller and their real estate agent they normally get excited about a San Diego homebuyers VA offer because the VA loan is so easy.
Who do you know that could use help buying their home with a VA loan? Call me, I’m Kim Ward, Real Estate Consultant at Horizon Real Estate. Our office number is 619-741-0111. We can talk about the best way to introduce me to the people you care about. We are here to help.