That’s correct!! Veterans, don’t always look for the lowest interest rate when purchasing a home. As you know many military folks will sell their home within a 4 to 7 year period. That said when shopping for a home loan your number one consideration when financing a house should be the estimated period you intend to hold the home. Based on this estimate, you may want to consider having the lender to pay your VA funding fee at the cost of a slightly higher interest rate. In most cases, the Veteran comes out ahead using this strategy. In one recent transaction closed in Virginia Beach this month my borrower saved over $4,300 on his funding fee at a cost of approximately $38 per month. Simple math showed it would take approximately ten years to recoup the cost of the VA funding fee which is funded (added) to the purchase price. This family intends to live in Virginia Beach for no more than 6-8 years upon which the borrower will be retiring and returning to Florida. This veteran reviewed the math and agreed.
So you wake up one day and decide that you’re tired of paying rent and it’s time to buy a home. You immediately go on-line, do a quick search and then find yourself bombarded by multiple agents, lenders and anyone else that can benefit from your home buying decision. It’s easy to see how you can become overwhelmed and rush out purchase a home and then wake up the next day wondering what in the world did I just do! Don’t get me wrong, buying a home is a fantastic investment. In the long term I don’t think there’s a safer investment. Owning your own home instills a sense of pride, helps bond a family together and helps you feel like a part of the community which you live. That being said here’s a few tips to help you make the best of your home buying experience so you don’t wake up with buyer’s remorse.
- Establish a budget: Do not depend on what the lender states you can afford. Trust me the lender will not be making the payment
- Save some money: Life will throw you a curve ball and there’s nothing more important than having funds to handle the situation when it arrives
- Use a Realtor/Agent: Don’t go it alone. You will never come out ahead. Besides the seller incurs the cost of the agent!
- Get Fully Approved: Don’t rely on being prequalified. You will be setting yourself up for surprises, emotional stress, and possibly the disappointment of not closing on your new home.
- Review Your Credit: Rates and Terms are impacted by your credit scores. Don’t wait till the last minute to address credit issues.
If you are in the market for new home, using your VA loan benefits and are considering older homes that may need upgrades you should be aware of the VA Energy Efficient Mortgage. This loan program allows you to roll up to $6,000 of energy efficient improvements into the cost of your home. These can include heating and air conditioning systems, insulation, thermal Windows and electronic thermostats. This loan program can also be combined with VA Interest Rate Reduction Loan should you be in the market to refinance your existing home. For more details give me a call today.