Veteran gets loan with no private mortgage insurance

Mortgage banker: Terry Hastings.

Home value: $ 1,100,000

Loan amount: $ 935,000

Loan terms: 4.5 percent, VA loan, 30- year fixed

Backstory: Hastings received a call from a borrower who was referred by his Realtor. He was buying a home in the same town where he currently lived and wanted to close in 30 days.

Since he was a veteran, could he get a Veterans Affairs loan for almost $ 1 million with less than 20 percent down and no mortgage insurance? And since the loan was being guaranteed by the VA, in- volving more paperwork. could they truly close in 30 days?

AVeterans Affair mortgage, known as a VA loan, is made through private lenders but guaranteed by the Department of Veterans Affairs as long as specific and stringent guidelines are met. The guarantee offered is typically not for the full amount of the mortgage and is set by “entitlement” numbers established by the VA.

One of the greatest benefits of a VA loan is no down payment is needed — and no mortgage insurance is ever required! Most members of the regular military, veterans, reservists and National Guard are eligible to apply for a VA loan.

Unknown to most people, unlike FHA and Fannie Mae, VA loans do not necessarily have a loan limit. In the borrower’s case, he qualified for an 85 percent loan for $ 1,000,000.

Similar to an Federal Housing Administration loan, VA loans have an upfront funding fee, which can be added to the loan. Since the loan is partially guaranteed by the VA, they require much oversight which can slow things down. In this case, the buyers needed to close in 30 days.

To no surprise, the borrower was ready with all the income and asset documents and Hastings’ bank sent electronic disclosures to e- sign thus expediting the process. To close within 30 days, Hastings’ bank sent the loan to underwriting for ap- proval even though there was a lag time waiting for the VA- assigned regional appraiser. By the time the appraisal was complete, the loan was approved just pending its review.

The file was cleared by the bank triggering closing instructions and mortgage documents that were sent to the buyer’s attorney. The buyer’s closed on their existing residence and new purchase on the same day, right on time.

The VA loan is a great way to honor and thank those who served our country.

Terry Hastings, Total Mortgage Services, ( 203) 470- 5434 TerryHastings. com