Don't Be Afraid of VA Home Loans: What Sellers Should Know

Are you turning down qualified buyers just because they're using a VA loan? As a seller, you might be leaving money on the table and we are going to show you why you shouldn't be afraid of a VA buyer.  In this eye-opening conversation, Candace and Lisa tackle the persistent myths surrounding VA loans that continue to disadvantage military families in today's real estate market.

Candace shares her personal experience of losing out on a townhome despite offering $15,000 more than the winning bid—all because the seller didn't want to work with a VA loan. This practice continues despite significant modernization of the VA loan process. Today's VA loans focus on practical concerns that benefit both buyers and sellers: electrical systems, termite inspections, roof integrity, plumbing, and air conditioning.

The hosts explain why VA requirements can actually protect sellers in an increasingly litigious real estate environment. By addressing potential issues upfront through required inspections, sellers reduce their risk of post-sale disputes. For older homes, a simple four-point inspection (often under $200) can reassure buyers that while a property might need cosmetic updates, its fundamental systems are sound.

Military buyers bring unique strengths to real estate transactions. The rigorous pre-approval process for VA loans often exceeds conventional loan standards. Their ability to purchase with 100% financing doesn't indicate financial instability but rather enables service members to build wealth through real estate despite frequent relocations. Many follow a strategic pattern: buy at their first station with a VA loan, later refinance to conventional, then use their VA benefit again at their next station.

Ready to expand your buyer pool and support those who serve our country? Join Candace and Lisa as they demystify VA loans and showcase why military buyers might be the most organized, prepared, and motivated clients you'll encounter. Leave your questions in the comments or reach out directly—we're here to help Tampa Bay's military families find their perfect homes.

Thank you for tuning into "Snapshots Tampa Bay with Candace and Lisa." We're thrilled to share our insights and adventures with you. To keep the conversation going and explore more about Tampa Bay and Central Florida real estate, connect with us on social media and other platforms!

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Transcript

Welcome to Snapshots Tampa Bay

Speaker 1 0:05

Hi everybody and welcome to Snapshots Tampa Bay with Candace and Lisa. Get ready to dive into the exciting and colorful world of the greater Tampa Bay area. Whether you're sorting out a military move, checking out the senior living scene or just on the hunt for the coolest local spots, let's get started and have some fun. Just on the hunt for the coolest local spots, let's get started and have some fun.

Speaker 2 0:28

Hello everyone, this is Candice. Hi Lisa. Well, hello there. How?

Speaker 1 0:33

are you today? I'm good, you know, I always say hey.

Speaker 2 0:38

That's my Atlanta coming out. I was in. Atlanta for 25 years before I came back, just like I have a phone voice. You always tell me I have a phone voice when I answer my phone.

Speaker 1 0:45

Yes, you do. You have a completely different voice. Wait a second. Try it, make believe you're answering your phone.

Speaker 2 0:51

Hi, this is Candice. How can I help you?

Speaker 1 0:53

Yep, exactly, it goes up like 10 octaves. It's crazy.

Debunking VA Loan Misconceptions

Speaker 2 1:05

I'm like, okay, she's of sales, it's got to be, it's got to be. That's all I can think of, all right? Well, today we are going to be talking about challenges for VA buyers, but specifically more what sellers on the seller side Like if you're going to sell your home and you may have multiple offers and one of them happens to be a VA buyer, and a lot of people think that a VA buyer is more difficult to deal with than a conventional loan buyer.

Speaker 1 1:26

Which we know as agents, that that is not true.

Speaker 2 1:30

And for perspective, because we both have dealt with this. My husband's actually a veteran, so we always get a VA loan and we actually, when we lived in Oregon, tried to buy a townhome and there were multiple offers on the townhome and we didn't get picked. And we found that afterwards that the party that got picked actually offered $15,000 less than us.

Speaker 1 1:51

And they got it, and even though you offered more on the townhouse.

Speaker 2 1:54

Yes, and then we were looking at another townhome in the same community and we saw that was back on the market. And so my agent because I was an agent in Oregon called them and said what's going on? It's back on the market. And so my agent because I was an agent in Oregon called them and said what's going on? It's back on the market. You know, we put an offer in. Would they accept that offer? Well, they don't want to deal with a VA buyer. I mean, my agent kind of was like well, that's kind of discriminatory, yeah it is.

Speaker 1 2:19

Well, I think the thing is is that a VA loan a long time ago was a very difficult loan, but today things have changed and actually it is a really really secure loan for the buyer.

Speaker 2 2:32

Back in the day inspections were a little crazier. They were very, I know because our first home. They were much more nitpicky and we bought an older home in downtown Orlando. They were very nitpicky with little things. The house was built in 52. It's not going to be perfect. It hasn't been remodeled. It's an older home. It was actually old VA housing from when the Navy base was there, so it was kind of funny that the VA was being nitpicky with it. But back then they were like that. They're not that much so anymore.

Seller Benefits of VA Inspections

Speaker 1 3:02

Well, I mean, here's the thing to think about. The things that they are concerned with for their buyers is electrical termite, roof plumbing and AC. So basically your four-point inspection plus the WDO inspection, which is for termites, wood-destroying organisms.

Speaker 1 3:25

But here's the thing If you think about it this way, with the way real estate is, with all these lawsuits and buyers are suing and sellers are suing and all this kind of stuff, in reality if you take a VA loan and you know they're going to be nitpicky about that, as a seller you're you're actually more protected because you're fulfilling what they want. Yes, so it's actually kind of a good thing to do, yeah.

Speaker 2 3:56

I actually encourage my sellers if they have an older home to do a four-point inspection If their roof is older, if the house is older. My listing that I've had recently that was an older couple in a 55-plus community. The house was built in 78. And I could see in the permit list some of the things that were done had been done. But the roof is a little older and in Florida we know that can be an issue. So I just encouraged them. A four point inspection was under $200.

Speaker 1 4:22

It wasn't expensive and that way and doing it beforehand, before it goes to the market, before people come in with their own inspectors to even say I have this four-point inspection.

Speaker 2 4:33

It's been very valuable as people have looked at that home, because the agent did pull up the four-point and saw that it was all clear, because it's a house that needed a lot of updating. So if you looked at it cosmetically you're like, oh, there's probably a ton of things wrong with this house.

Speaker 1 4:48

Well, look, I was born before 78. I cosmetically need a lot of help too, so I totally understand.

Speaker 2 4:54

But you're healthy.

Speaker 1 4:55

Other than that.

Speaker 2 4:56

Like I mean yeah.

Speaker 1 4:58

We all got good bones, the house got good bones.

Speaker 2 5:01

I got good bones. Exactly, the house had good bones, and you recently dealt with this too, with a VA buyer I did.

Speaker 1 5:06

With your.

Speaker 2 5:06

Clearwater property yeah.

Speaker 1 5:08

So my husband and I we did a flip property. So we bought a home. It was in complete disrepair. We did a full renovation of the home and the inspector for our buyer and they were a VA buyer inspector for our buyer said, hey, I'm seeing not live termites, but we're seeing previous damage from termites, which is common in Florida, very common in Florida.

100% Financing and Wealth Building

Speaker 1 5:36

We need to have it treated for the VA to sign off on it, and so we had it treated. And that wasn't expensive no, it wasn't, maybe $600 to have the whole attic treated. And look now we took care of their problem. So nobody's going to come back at us because we took care of the problem and the VA signed off on it. And I mean the thing is, is that you have people who have to move every two years sometimes. I mean you take your family.

Speaker 2 6:09

Entire family Kids, dogs, cats, yeah.

Speaker 1 6:10

So I mean, you take your family Entire family, Kids dogs, cats, yeah, so I mean being somebody who will sell to them and being okay to sell to someone who is actively serving for our safety, for your freedoms, for your freedoms. You know it's something to know about. So can you talk a little bit more about down payment, that they have to do and things like that, because a lot of people are like, well, why aren't they putting more money?

Speaker 2 6:42

down. So as a VA loan you can get 100% financing. So as long as the house appraises like, you can't be outfitting on a house that's only worth 800,000 and trying to pay a million dollars for it and get financed 100%. That's not gonna happen. But if you're buying a normal single family home in your budget you get 100% financing. So you don't have to come with any money down, just your closing costs.

Speaker 2 7:04

There is a VA funding fee that you have to pay but that can get rolled into the loan as well and doesn't affect the appraisal. So if the house is appraised for $400 and you're paying $385 and let's just say the VA funding fee is $10,000, it's still under the $400,000. But even if it went over the $400,000, they don't count that VA funding fee within the appraisal part of it. So it makes it easier for a family, particularly a new military member, who wants to start building wealth and maybe buying a house at their first station, then renting that house out, refinancing it with a conventional loan, taking their VA benefits, going to their new location, buying another home, and now they're building wealth as a family everywhere that they go. And in fact I'm a part of the Compass Military Division, as you know, and we actually encourage building wealth for military families because then when they get out of the military serving their 25 years, they not only have their retirement with that, they also have investment properties that they've been building For years.

Speaker 2 8:07

For years, which is going to help support their family for the rest of their lives, especially if maybe they get injured in war and they can't maybe work. They're disabled and now they can't work like a regular job. This is going to help them down the road to build their wealth.

Speaker 1 8:21

Well, and not only that, when somebody is going to look for a VA loan, they check those people a lot more than just a regular pre-approval.

VA Loan Process and Military Organization

Speaker 2 8:34

It's a little more intense. The pre-approval process is basically you're qualified. I mean you just have to do the final documentation with your income right before you close, which is any traditional one. But the pre-approval process a VA pre-approval letter is more solid than a conventional loan or an FHA pre-approval letter.

Speaker 1 8:55

Yeah, and I think that talking to sellers about all this and getting them making them aware and another thing to be aware of, too, is you may be selling a home to just the wife who has power of attorney because her husband, or even the wife, is in the military. It doesn't make a difference who's gone, but they always have a power of attorney to sign those documents to make sure that everything is taken care of. They are already preset with all that stuff.

Speaker 2 9:25

They're more organized than any other buyer because they've had to move multiple times their spouse.

Speaker 2 9:32

My husband was on submarine so he'd be gone for six months of the year underwater. There was no having him sign documents if he was underwater Like that's not possible. So I had to have power of attorney. So if there was anything financially that needed to be doing I could do so. We had like nice little folders in our safe that just took care of everything, like we had it all ready to go. We were very organized and most military families are very organized.

Speaker 1 9:55

Yeah Well, you have to be, especially if you're moving every couple of years. You know you can get your PCS and and go and for for people who aren't in the military. So they get their papers that say okay, you're being restationed somewhere else and the military is going to be moving you, but you still have to set up shop.

Speaker 2 10:17

Yeah, that spouse and those children still have to set up shop somewhere else and potentially sell the house where they're at to buy a new house where they're going.

Speaker 1 10:24

Yeah, yeah, so helping these people and and I feel like our responsibility is teaching people, the sellers, that these buyers are really, really qualified. A lot of them are, some aren't. It's just like any other situation, but but having a VA loan come in to purchase your home, it's not.

Speaker 2 10:47

It's not really any different for a seller. It isn't. It isn't. It's a seamless transaction.

Speaker 1 10:54

Well, you know what? I think we did a lot. Is there anything else that you want to talk about? On the VA loan, you think we got everything today.

Speaker 2 11:00

I think we got everything today. I mean, there's always one-offs and those are things you have to have a conversation with your sellers or your buyers, Because there's always one off on any real estate transaction. Let's be clear. Oh yeah, but yeah, for the most part. Don't turn down a VA buyer because you think it's going to be more difficult. It's not going to be.

Episode Wrap-Up

Speaker 1 11:18

It is definitely not going to be, especially if you have us, especially if we're on that side of the transaction. Well, you know, we always like to say if you have any questions, please put them in the comments, please reach out to us. We want to help in every way that we possibly can and, like I try to always say, we're going to tie this up with a nice little sparkly bow, just like our sparkly shoes. And until next time, tampa Bay, bye, bye. Thanks so much for joining Snapshots Tampa Bay. Hit, subscribe to catch our latest episodes and let us know in the comments what you want us to explore next. Keep loving the Tampa Bay vibes. See you guys soon.