Your Home Sold Guaranteed Realty - Reeds Real Estate

6 Common Mistakes Veteran Home Buyers Make

Veteran home buyers are in a unique circumstance compared to average buyers. As a veteran, you have access to special loan products, which come with their own requirements. If you’re in the market for your first home as a veteran, you may not know what to look out for.

At Your Home Sold Guaranteed Realty - Reeds Real Estate, our real estate team is veteran-owned and operated. This means we specialize in helping veteran buyers navigate the real estate market. 

In this post, we’ll break down six common mistakes veterans often make when buying a home. That way, you can be as prepared as possible to find your dream home.

  1. Assuming Any Realtor Can Help You

Many veterans assume they can hire any realtor to help them buy a home. However, using a Department of Veterans Affairs (VA) home loan means the home-buying process is slightly different compared to average buyers.

For this reason, working with a realtor who specializes in helping veterans is crucial. They should be familiar with the VA loan process and the requirements that come along with it. 

In addition, they should be familiar with VA loan products and other veteran benefits so they can advise you on the best fit for your situation.

  1. Not Asking Your Lender What Benefits They Offer

Another mistake veteran home buyers make is not asking lenders about what benefits they offer to veterans. 

Aside from the advantages of VA home loans, individual lenders may offer their own additional benefits. For example, waiving origination or appraisal fees if you meet certain criteria.

While interviewing lenders, mention your veteran status and ask if they offer additional incentives for working with them. Ideally, you should speak to three to five different lenders before making a decision.

  1. Not Considering Different VA Loan Types

Many veteran buyers are unaware of all their VA loan options before they start applying for home loans. There are four different types of VA loans:

  • Standard purchase loan. Offers a number of benefits for veterans purchasing a primary residence. Aside from not needing a down payment, you can also use these loans to upgrade your current home or purchase land to build a home.
  • Cash-out refinance loan. Can be used to take equity out of your home and turn it into cash for home improvements. It can also be used to refinance a non-VA loan into a VA-backed loan.
  • Interest Rate Reduction Refinance Loan. The best choice for veterans that want to refinance an existing VA-backed loan to get a better interest rate. You can either lower your existing interest rate or switch from an adjustable-rate to a fixed-rate loan.
  • Native American Direct Loan program. The NADL program applies to veterans who are Native American themselves or married to a Native American spouse. It allows you to buy a home or make updates to an existing home on tribal land.

Some veteran home buyers also don’t realize that it’s possible to have more than one VA loan at the same time. If having two loans is something you think you could benefit from, be sure to ask your lender what your options are.

  1. VA Loan Requirements

VA home loans come with their own set of requirements compared to conventional loans. First, you’ll need to show a Certificate of Eligibility to prove your military service. You can obtain this certificate by having a specific number of days on active duty service. 

For veterans, active duty service requirements will depend on when you served in the military. For current service members, this amount is 90 continuous days. It’s also important to note that spouses can take out a VA loan if they’re eligible.

The other main requirement for a VA loan is that the home you buy must be used as your primary residence. It also needs to meet certain building codes and safety standards, as determined by a VA appraisal.

Once you’ve determined you’re eligible for a VA loan, all that’s left is to meet the lender’s requirements. These might include having a qualifying credit score, debt-to-income ratio, and other aspects of your financial situation. These vary depending on the lender, so be sure to ask them during the interview process.

  1. Not Planning For All Closing Costs

Using a VA home loan means you’ll save substantially when buying a home. However, this doesn’t mean you’ll escape all costs associated with purchasing a home. You’ll still have to pay closing costs, appraisal fees, and home inspection fees.

In addition, you’ll have to pay the VA funding fee, which is usually included in your monthly mortgage payments. This fee is used to fund the VA loan program for other veterans. It can only be waived if you meet certain disability criteria.

Understanding all these costs can help you create a proper budget so there are no surprise expenses in the process.

  1. Thinking a VA Appraisal Means You Don’t Need an Inspection

Similar to conventional home appraisals, VA appraisals evaluate the price of a property. But they also go beyond traditional appraisals because they check to make sure the home meets certain health and safety requirements. 

In addition, while VA appraisals are required, home inspections technically aren’t. For this reason, it’s easy for many veteran home buyers to think they can skip a home inspection altogether. However, this isn’t the case.

The VA appraisal ensures the home meets basic building and safety standards, but the appraiser won’t inspect the home as closely as a professional home inspector. They won’t evaluate the plumbing, electrical, or HVAC systems and won’t enter the attic or crawlspace.

A home inspection is essential to know the health of your home’s structure and systems. They’ll provide you with a full assessment of the home’s condition, so you know what repairs may be needed.

Our Team Helps Veteran Home Buyers in Chesapeake, VA

If you’re looking to buy a home in Chesapeake, Virginia, our team at Your Home Sold Guaranteed Realty - Reeds Real Estate can help. Not only are we regularly ranked as one of the best realtors in Chesapeake, but we’re also a navy veteran-owned business. 

We know the VA home loan process intimately and can walk you through what to expect, as well as recommend the best VA-friendly lenders.

We’ve helped many veterans find their dream homes and know we can do the same for you. Plus, our buyer guarantees make the home-buying process risk-free and stress-free.

This includes our Guaranteed Cash Savings Program and Buy It Back Guarantee.

To learn more about our guarantees or what it’s like working with our team, call (757) 799-4824. You can also fill out the form below for more information.

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