Are VA Loan Appraisals Tougher?

Are VA Loan Appraisals Tougher?Your status as a military veteran gives you access to benefits that make buying a home easier. Yet your VA loan does come with a few requirements. A VA loan appraisal must be completed before a lender can approve the loan.

At first glance, these appraisals are intimidating. You may have even heard that the ones that are required by the VA are tougher than those used for conventional loans. The truth is that these appraisals are designed to be stringent, but they serve an honorable purpose.

Appraisals are meant to accomplish two important goals. First, the lender and the federal government need to be sure that the loan you take out represents the property’s fair market value. Second, the appraisal is meant to ensure that veterans have a safe and comfortable place to live.

Remembering that the appraisal process is meant to help you select a home that is a wise investment is the best way to get through this phase of buying a house. You can also do things that make the process easier. For instance, choosing a house that is in good repair makes it less likely that the appraiser will find something wrong.

What Are the Minimum Property Requirements?

VA Loan AppraisalThese appraisals go one step beyond the ones that are used for conventional loans by having the appraiser check to make sure that the property meets the VA’s Minimum Property Requirements.

Some of these requirements are fairly easy to meet, such as making sure that your house is designed to be a residence with adequate living space. Others may be tougher, but they are meant to make sure that your house is safe and structurally sound. For instance, basements must be dry and properly vented.

What If the Minimum Property Requirements are Not Met?

If the requirements are not met, then you have the option of fixing them. You can also ask the seller to cover the cost of any repairs. For example, the seller may decide that fixing a bad roof is worth doing since most buyers will request it. Once you correct the issues, you can then have the house reinspected to get your loan approved.

What If the Home Is Appraised With a Lower Value?

There are times when a home’s value comes back low. When this happens, you have several options besides just walking away. You can work with your real estate agent to request that the seller lower their asking price for the property. While they may not always agree to do so, this is often the fastest and easiest way to move forward with the sale.

VA Loan Appraisal InformationIf you are determined to buy the property, you can also put up your own cash to make up the difference between the asking price and the amount you can get approved for the loan.

If you feel the appraisal was faulty, then you may also be able to seek a Reconsideration of Value. The VA is aware that an appraisal may sometimes be incorrect, and a loan specialist can help you work through the process of having it reviewed.

The appraisal process may leave you feeling anxious about your home purchase, but they tend to go fast. We can also work with you each step of the way to make sure that you know your options if the appraisal reveals that you need to take further action.

Jimmy Vercellino is an experienced Phoenix mortgage lender. He and his team work hard to provide a timely, efficient and excellent home loan process for buyers. As a loan specialist, Jimmy manages the entire process for his clients, making the home buying experience a pleasure instead of filled with stress.


Forecast for Arizona 2019 Mortgage Interest Rates

Forecast for Arizona 2019 Mortgage Interest RatesIt’s that time of year when we have a better idea of what the future holds for homebuyers in Arizona. The rise and fall of mortgage interest rates is always at the forefront of the decisions that we help people make.

In fact, getting the lowest interest rate possible can help you afford more on a home purchase than you thought was possible. While interest rates can fluctuate wildly depending upon factors outside of our control, we can now issue you our best forecast for the rest of the year.

Factors That Affect Mortgage Interest Rates

It often seems as though interest rates fluctuate on a whim. However, there are both external and internal factors that influence how high and low rates get in a given time period.

For instance, lenders tend to charge higher rates when more people are buying homes. The Federal Reserve Board also lowers and raises rates, depending upon the need to influence the economy.

Internal factors that affect interest rates are things that you can often control. Your credit score, along with the type of loan that you seek, have a significant impact on the rates you are offered. Putting down a higher down payment can also help you to receive a lower rate.

Recap of 2018

The forecasts for last year mostly came true. Before the year started, it was predicted that mortgage interest rates in Arizona would rise slightly and end at just above 5%. While this did happen, they also took a slight dip towards the end of the year with the market swinging in favor of buyers.

We ended the year nicely with an average interest rate that was just below 5% for the typical loan applicant.

What to Expect This Year

Right now, the average mortgage loan interest rate on a 30-year fixed rate loan is hovering at around 4.6%. It is slightly lower if you opt for a 15-year fixed rate loan, which is around 4.07%. Since the rates are expected to stabilize, this should stay true for the majority of the year.

Variances According to Location

If you are moving from a different state, you may notice that the average home loan rates differ in Arizona from where you currently live.

In past years, interest rates also varied among the different cities in Arizona. For 2019, however, they stay close to the same rate throughout the state. Therefore, you can expect to see similar rates for Phoenix as you would for another city, such as Flagstaff.

How to Get the Best Mortgage Interest Rate

Naturally, every home buyer wants to get the best mortgage interest rate possible. After all, even the difference of a single percentage adds up over the term of your loan.

In addition to buying your house while the interest prices are low, you can improve your financial standing. Making the effort to pay down your debt and make timely payments helps to increase your credit score, which is one of the ways lenders determine your rate.

You can also compare the rates offered to you by different lenders. Our team is adept at quickly getting those numbers so that you find the one that helps you save more on interest over time.

Depending upon your eligibility, we can also help you find types of loans that offer lower mortgage interest rates. For instance, a VA loan has negotiable interest rates.

With interest rates stabilizing, the time to buy your new house is now. If you were deterred by higher interest rates in the past, give it another look.

From now through the end of the year, your forecast looks better than it has in years.

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Buy a House With Low to No Down Payment – Here’s How

How to Buy a House With Low to No Down PaymentOne of the factors that make it most difficult for individuals or couples to become homebuyers is coming up with a big down payment. Commonly, 20%, which is common at many banks, on a $100,000 loan is $20,000.

To some, that amount may as well be $100,000 because it’s almost impossible! Fortunately, there are many options available today for potential homebuyers.

Loan Options with Low or No Down Payment

Here are some excellent loan options that offer low or no down payments to eligible applicants.

VA Loan

Offered through the Department of Veterans Affairs, the VA mortgage loan is a zero-down loan available to current or former military personnel. Although applicants can put a down payment down if they so wish, there is no down payment required.

VA loans do not require excellent credit, and they offer 100% financing. They are even available to those who have been in the National Guard or Reserves for at least six years.

First time home buyers may be required to pay a 2.15% loan fee upfront. Mortgage insurance is not required with VA loans, which alone can save homebuyers hundreds of dollars.

FHA Loan

Offered through the Federal Housing Administration, the FHA loan is probably one of the most popular home mortgage loan types for several reasons. It only requires a 3.5% down payment, and the down payment can come from a gift or an approved non-profit organization.

Borrowers do not need good credit to be approved for an FHA loan. While this may vary by lender, credit scores typically can be as low as 580 with an FHA loan.

FHA loans do require two types of mortgage insurance. One type, 1.75% of the loan, is paid upfront, and the other type, 0.85% is added to the mortgage and paid each month. Mortgage insurance can be canceled when the home reaches 20% equity.

Another big benefit of FHA loans is that their interest rates are substantially lower than conventional mortgage loans.

HomeReady Mortgage®

Backed by Fannie Mae, the HomeReady Mortgage® is a conventional loan type that offers low down payments to eligible borrowers. Borrowers can pay down payments as low as 3%.

The HomeReady Mortgage® is not just for first-time home buyers, but is open to all buyers who meet the requirements. Although borrowers of all incomes can benefit from this mortgage, it’s aimed at helping those with low and moderate incomes.

Because this is a government-backed loan, borrowers also get lower interest rates. It’s typically for borrowers who have a household income 80% less than the median income in that area. The home’s census must meet certain requirements.

Home Possible Mortgage®

The Home Possible Mortgage®, which is backed by Freddie Mac, is a conventional mortgage loan that requires potential borrowers pay as little as 3 percent down payment. Borrowers can have less than perfect credit scores and can have income from non-traditional methods.

Although Home Possible Mortgage® is designed to help low-to-moderate-income home buyers, it’s open to all incomes as long as they meet the eligibility requirements.

When you’re ready to take the plunge, or even if you’re just thinking about it, stop and visit us or give us a call. Our loan specialists are First Choice Loan Services are always ready to help you and show you what we have to offer.

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