VA Home Loan - Tips and Timeline?

[Mick-Boy]

We're going through a similar process right now. Baby #3 on the way, bigger house needed, etc. We're buying on a VA loan (3.25%). Our process was a little unorthodox because my wife found the house she wanted the day I left for Afghanistan (I was not thrilled..) so everything from my end has been esigned/printed and mailed)

As I understand it, the biggest delay with VA loans is the appraisal process, which can run a few weeks. As far as the Etc. on your list, just to give you an idea;

OCT 27 Pre-qualification letter received/Loan application submitted
NOV 1 Loan assigned to processing
NOV 10 Loan sent to underwriting
NOV 11 Loan Approved
NOV 21 Loan Assigned to appraiser
DEC 5 Appraisal complete
DEC 8 Loan sent to title company

We'll close as soon as my PoA shows up in CO. All in it's going to have been a 7-8 week process from offer to closing.

[skoodge]

The reason for PMI, and it's cutoff at 80% LTV on conventional loans, is that when the borrower defaults on the loan and the lender forecloses on the house, the lender then has to resell the house to get their money back. But, foreclosure sales usually only sell for 80% of their value; so the difference between the sale price and the defaulted loan amount is paid for by the PMI company. Essentially youre paying insurance to make sure the lender doesn't lose money in case you default on the loan. Typical insurance "scam", your money protects someone else. FHA loans are the same concept, but you pay PMI for the life of the loan. This is because FHA is usually used for borrowers with lower credit, etc.

Also, yes from what I've heard around the office, VA appraisals are a bit backed up because so many people are buying houses right now, and there are only so many appraisers that are licensed to do VA appraisals. They're just booked up. But depending on the lender, your appraisal, and you getting the requested documents to your LO, loans can take anywhere from a week to months to close.

I highly recommend, while in the process of your loan, do NOT open any new credit cards, car loans, bank loans, etc; or go on a spending spree with your credit cards. This can throw your debt to income ratio to high for approval. You'd be surprised how many people get a new CC mid-loan process, then charge the crap out of it, or buy a new car, then wonder why there are problems.

Also, I recommend shopping around for rates. Once they pull your credit score, you have 30 days to get it pulled as many times as you want/need, within the same industry (i.e. other mortgage brokers only, car loans or credit cards are a different industry), with out getting another hit on your score. I think most people go with the first lender they talk to because they don't know that, and the lender wont tell you that. So, 30 days, shop around.

Good luck!