Common mistakes veteran and military home buyers make.

military new home buyers

Living in your own home is an essential part of the American Dream. Whether you are a first-time or last-time home buyer, the U.S. Department of Veterans Affairs offers plenty of great programs to help those who have served in the military home buyers.

With that said, the process to get a home loan as a veteran is complex and not a sure thing. There are ways to prevent a buyer’s nightmare by avoiding mistakes before you start your search. Military Home Services reached out to our Realtor and mortgage partners, who are all VA experts, and asked them about the most common mistakes they encounter with VA buyers and how best to avoid them.

1 Not using a VA-experienced real estate agent.
This shouldn’t be surprising but it is the most common mistake. The truth is, most real estate agents are not experienced with the VA home loan process and, in fact, may have never closed a home purchase that was financed with a VA home loan. Why is this? Because only 10 to 12% of all home loans are VA home loans.

A lot of people work with agents who don’t understand the VA system. Not only do buyers need to qualify for a VA home loan, but the home must also qualify. When you’re buying through the Veterans Affairs department, you’ll need to find a home that meets VA property requirements. A VA property appraiser will evaluate the property against different standards than a conventional loan appraiser. The VA has strict requirements for properties it will finance. Imagine making an offer on the home of your dreams only to find it won’t qualify for a VA loan. An agent who is experienced with VA requirements will often recognize the issues before you even place an offer saving weeks of time and disappointment. In addition, an agent experienced with VA purchase loans will also know about VA loan limits, required debt-to-income levels, and more.

Save yourself the time, frustration, and disappointment of making an offer on a house that may not get approved, or for which you may not qualify. Work with a VA-experienced real estate agent from the start. Get help from Military Home Services to find the right VA-qualified real estate agent.

moving in

2 Not telling your lender of your military service.
According to the VA, 33% of home buying Veterans don’t know they have a home loan benefit, which is arguably the best home mortgage option available. Military Home Services will ensure that you are aware of all your home finance options. Our referred loan officers are VA loan experts and already know you are a Veteran. Whether a VA loan is best for you or not, you can be confident they will guide you to what’s most suitable for you.

One of the biggest benefits you’ll get with a VA loan is the ability to buy with a 0% down payment. This alone may make it possible for Veterans to buy a home years before they would be able to if they had to save up for a down payment. VA loans also come with low-interest-rate mortgages, don’t require mortgage insurance, and have more forgiving credit eligibility requirements. The lenders referred by Military Home Services offer exclusive cost-saving benefits and credit to veterans. To learn more about getting your loan approval and closing your transaction, visit Getting Loan Approval.

3 Hiding details of your financial situation.

t’s not unusual for home buyers to get pre-qualified and nearly through final approval when something gets discovered they thought never would. The result is a lot of wasted time and having to take a closer look at your finances. Tell your loan officer everything about your financial situation even if you don’t think it is relevant or won’t get discovered. Your loan officer needs to know everything, whether good or bad.

4 Forgetting about upfront home-buying costs.
While you’ll have a variety of financial advantages with a VA loan, you will have some borrower costs to deal with. Except in certain circumstances you will need to pay a VA funding fee as well as the VA appraisal fee, title insurance, loan origination fee, and more. It's important to keep in mind that even if you have a 0-downpayment, you will need to have money available for these fees. Your Military Home Services will save you money on these and will be able to provide more details on how much they may be.

forever home

5 Thinking It’s Your Forever Home.
We don’t stay in our houses forever. Most of us move within 10 years of a home purchase, often much sooner. Most Americans can expect to own three homes in their lifetime.

If you are active-duty you may be relocated in a year or two. If you are a veteran in your prime working years, your income may increase dramatically allowing you to purchase a larger home in a better neighborhood. Your military service pays. On average, veterans earn more money than non-veterans.

Don’t expect your first home to be your last home. Think of it as a “stepping home” for your next home.

6 Not thinking of your home as an investment.

“Ninety percent of all millionaires become so through owning real estate.”
– Andrew Carnegie

This quote has been proven true not just for years or decades but for centuries. Nothing has provided financial security better than owning your home. If you are active-duty, you may think there’s no point in buying because you may be relocated in the next few years. The fact is that there are very few if any, reasonable reasons not to buy as soon as you are able. History has shown that owning your home is a smart investment.

Of course, purchasing the right home in the right area and getting the right loan for the right price, are key. That’s why it’s critical to work with the right Realtor and loan officer. They know those things and can advise you so you don’t make the wrong decision. If you follow their advice, even if you own your home for only a year or two, odds are you will be building equity. This will help if you do get transferred and need to buy in a new location. Or, you can choose to hold on to it and rent it out. Look beyond owning a home, look at owning an investment. Remember, you can use your VA home loan benefits over and over again.

To learn why owning a home is your most worthwhile investment and how it will help you reach financial security, visit Equity Building.

new car

7 Making other big purchases before closing.
Buying a home takes a commitment of time and money. Once you are secure enough with your financial situation and you have made the decision to start looking, don’t get sidetracked with other purchases. You need a new car. Wait to buy it. You need to furnish your new home. Wait. You want to take a costly vacation. Don’t.

Wait to make any costly expenditures until you have closed on your home. You don’t want more debt and may need the cash to secure lender approval and finalize your purchase.

The Realtors and lenders Military Home Services refers are all experts in VA loan requirements. They are committed to ensuring that you receive the finest representation possible. We look forward to helping you reach your real estate goals. ENROLL HERE to get started.