VA loans have changed a lot in recent years and are now generally no more difficult or expensive for sellers than any other loan. The short answer is “no. It's true that VA loans were once harder to close, but that's ancient history. Nowadays, you're likely to have more or less the same problems with a buyer who has this type of mortgage as you do with any other.
And flexible VA guidelines may be the only reason a buyer can buy their home. VA loan inspectors look for certain problems with a home, such as wood rot or lack of floors, that need to be addressed before the sale can continue. Some sellers refuse VA loans because of that inspection, assuming this will complicate the sale. Accepting an offer from a buyer who uses a VA loan when selling their home can be as difficult as a buyer using a conventional mortgage.
There are a lot of myths and misconceptions about the VA loan, but you, as a seller, need not worry about a thing. When you sell to a VA loan buyer, you support veteran or active military homeownership. This does not provide any practical financial benefit to sellers. But, you can certainly argue that supporting veterans as homeowners is still a good thing.
If you're applying for your first VA loan and don't make a down payment, the financing fee is 2.3% of the total amount you borrow. There is a long-standing misperception among some realtors that VA loans are riddled with red tape and red tape and take forever to close. For most people, that's no big deal, but if you're looking for a wealth creation opportunity, a VA loan won't work for you. And they're not going to undervalue (or certainly shouldn't) undervalue your home just because your buyer has a VA loan.
About 64% of home purchases with VA loans closed in August, according to mortgage software company Ellie Mae, compared to 41% for conventional mortgages. If you deposit money or have taken out a VA loan in the past, the fee can range from 1.4% to 3.6%. While selling to buyers of VA loans is not the best option for most sellers in a very competitive market when there are multiple increasing offers, in a normal market, there are not many downsides. This high-quality nature means that if you are a veteran buyer, you are likely to use the VA loan.
Many veterans are struggling especially hard to compete, and according to Wemert and several other realtors familiar with the VA loan program, that's because many sellers, and their agents, don't understand how it actually works. And the only exception is if that buyer has a VA loan and shows up at the bargaining table with their service M4 carbine. VA mortgages are attractive to mortgage lenders because the loans are backed by the federal government. Many people argue that VA loans take longer to close, making it difficult to work with these buyers.
And, for sellers, the most important thing they need to understand about VA loans is how good mortgage products are for qualified borrowers. Over the past six years, VA loans have a higher average closing success rate than conventional mortgages, according to data from Ellie Mae. He said social media helps, because service members and veterans can exchange stories about their successful VA loans and share resources such as contact information for realtors or lenders who know how to navigate the process. .