VA Loans

[danielstevens]

Hello all,

My name is Dan Stevens, I'm a sales manager at National Bank of Kansas City's mortgage division.

You may have noticed a new advertisement for National Bank of Kansas City this week in the forum. I just wanted to introduce us to you all by posting a short note.

Over the last couple years, we've received several referrals from members in your group so we thought it would be good to help sponsor this forum and make it easy for anyone to contact us.

If you have any questions about VA loans or our bank, feel free to reach out to me via this forum.

you can also reach us at baseops.nbofkc.com

Interest rates are at the lowest point I've ever seen, this especially helps people with existing VA loans looking to refinance.

Thanks, Dan

[matmacwc]

Heard all this before, how low are the rates and what are your closing costs. Make yourself competitive, I need a loan in 4 months.

[daynightindicator]

ditto matmacwc...

in addition, could you post guidance on the following?

- the IRRRL (VA re-fi) - i am looking to re-finance my current home for a lower rate and would like to do so without a down payment or closing costs...

- use of "second-tier" entitlement - specifically, after i re-fi, i plan on renting that property and purchasing another at my new duty station. i would like to use a VA loan for that as well to avoid down-payment/PMI if i can...

decided not to PM this because i thought others might be curious about their options in these situations beyond the normal first-home-purchase

[IDALPHA]

In on this one as well...

[GoodSplash9]

Any cash back incentives like USAA provides their members for mortgages?

[nsplayr]

The only thing I know about NBoKC is they won the contest for who could contact me the latest after I had already bought my home. inquired about financing in May 2009, bought in Aug 2009 with a local lender, but apparently Nov 2011 is still a great time to check up on how my search was going! I give you +5 points for persistence but -5 for common sense.

[danielstevens]

Thanks everyone for the replies,

I'll do the best I can to reply in this format with as much info as possible. I know you all don't need or want a heavy sales pitch, so i'll try to avoid that.

The most popular loan program we help people with on at present is the VA 30 year fixed loan.

While every loan situation is different, the dominant interest rate people are getting on a VA 30 year fixed is 3.75% at present. Rates have been in this range for the last couple of months. One never knows for sure how long they'll last, but that's what we've been able to do recently. On a 200K refinance loan that would create an APR in the range of 3.80%.

To speak to our competitiveness, every place that originates VA loans has different fee structures to get the same rate. One thing you'll find with us is there aren't any fees payable to the bank on any VA loan. There will be 3rd party costs such as title insurance, VA funding fee if that is applicable. If anyone would like me to get a specific quote for you, you can PM me if you'd like.

I did want to answer the specific questions too.

Daynightindicator - the VA IRRL definitely sounds like a good option for you to explore. You can often structure a VA IRRL so the bank absorbs all the closing costs for you so you don't have to significantly raise your loan balance. As far as your second question about a 2nd VA loan existing at the same time, I would answer that as a "maybe". The VA gives a pool of eligibility that each existing loan takes up a portion, or all, of. It really depends on loan amounts for both loans you are looking at having at the same time. The calculation for this is somewhat complicated, but I'd be happy to help get you an answer to your specific situation if you would like to do a follow up post with the loan amount ranges for your loans. (or PM me)

Wraith - I'm not sure exactly what you are referencing with USAA. But we do have options where the bank can absorb all the closing costs for you so it's truly a no cost loan. (not just rolled into the loan) We aren't able to go beyond just paying all the closing costs and give cash on top of that.

nsplayr - Sorry about that very late checkup on our part!

Let me know if there is anything else I can answer for any of you! Thanks again for your replies.

[Whitman]

Are the VA funding fees still 2.25% for zero down or 1.5% for 5% down?

Dropping 4500 bucks to get a loan on a 200k house isn't that great of a deal. 15 year conventional fixed with 20% down is so much cheaper in the long run.

Edited January 5, 2012 by Whitman

[danielstevens]

Whitman - You have it correct on the funding fee schedule. And I agree with your statement about putting 20% down being better in the long run.

If a borrower does have 20% down the only way a VA loan would be superior is if they were exempt from the VA's funding fee. That only occurs if the VA has granted a service related disability to that veteran.

Of course, if 20% down payment is not in the cards, the VA option becomes a very competetive alternative to the FHA loan.

[Whitman]

If a borrower does have 20% down the only way a VA loan would be superior is if they were exempt from the VA's funding fee. That only occurs if the VA has granted a service related disability to that veteran.

Great point Dan. I think my Dad had his funding fee waived due to partial hearing loss from flying jets. Only VA loan I would do is the 5% down option. 10k down (on 200K home) but saves $1500 on the funding fee (4500 vs 3000). However, it's still $3000 that doesn't give you any equity, despite the appeal of having the fee rolled into the loan.

[Dupe]

Great point Dan. I think my Dad had his funding fee waived due to partial hearing loss from flying jets. Only VA loan I would do is the 5% down option. 10k down (on 200K home) but saves $1500 on the funding fee (4500 vs 3000). However, it's still $3000 that doesn't give you any equity, despite the appeal of having the fee rolled into the loan.

If you can easily come with with the standard 20% down, then a VA loan wasn't really designed for you. It was build to get vets into home ownership without them having much cash on hand. It beats the pants off of FHA loans and probably anything requiring PMI. If you can put up 20% down, then you're pretty much of the market for VA loans and really should just be looking at the myriad of private institutions.

There's a few other limitations to VA loans that I've run into: 1) you must occupy the property, so you can't use a VA to fund a second home / income property (though you can refinance your current home to a VA then use that available equity to fund a second home) 2) The home must be in the US...sucks if you're still OCONUS. 3) The VA loan can only be funded up to about 103% of the home's value...so you can't buy an undervalued home (read: one in need of many improvements) and roll what ammounts to a construction loan into it.

[danielstevens]

We have had some good referrals from your network over the last year or so, and I appreciate that a lot.

I did want to give everyone an update with some of the inquiries we are receiving this last week. There is a lot of interest in the VA streamline refinance, for obvious reasons, as rates are currently in the 3.75% to 3.80% APR at present.

One big question we are getting is whether an appraisal is needed. I thought I'd explain that to everyone here.

The short answer is "maybe", which I know doesn't help much!

The long answer is that the VA doesn't require it, but sometimes the existing lender will put an extra requirement that an appraisal check is needed. For instance, Bank of America is one existing lender that is strict in this area.

However, Wells Fargo, Citimortgage, US Bank are all pretty flexible on not requiring an appraisal (sometimes USAA loans are actually serviced by US Bank which does make them eligible for not needing an appraisal). Fortunately, a lot of people fall in that second category. However, I know what people really care about is where they personally fall!

But even if an appraisal is required, they are really just making sure the house isn't considered "upside down".

So to sort of summarize the lengthy explanation. If you think you are "upside down" then we can really only help you on the VA IRRL if you are fortunate enough to have an existing lender that is flexible (like the ones I listed above).

If anyone has specific questions on this, please let me know - and PM is fine too!

[HeyWatchThis]

For instance, Bank of America is one existing lender that is strict in this area. However, Wells Fargo, Citimortgage, US Bank are all pretty flexible on not requiring an appraisal (sometimes USAA loans are actually serviced by US Bank which does make them eligible for not needing an appraisal).

I just closed a VA streamline refi with BofA last month and they did not require an appraisal.

[danielstevens]

MattS - Thanks for the info. I'm guessing you went to them directly, as about a year ago or more they changed their requirements for banks that do business with them making the only way outside lenders like us to get it done is with an appraisal.

That does bring up a good point though, that if you have a loan with BofA, and an appraisal is likely to mess things up, that giving them a call definitely can't hurt if you are in the market for a VA IRRL.

[Skitzo]

I had a VA IRRL lined up with Wells Fargo at 3.75, USAA was prior lender. They stipulated an appraisal that I would not meet. I guess I'm lucky USAA was willing to refi at 4.0 I close on Friday

[danielstevens]

Hello,

 

I just wanted to let everyone know we added a video with a brief explanation of the VA Streamline Refinance to our VA page.

 

You can see it here https://www.nbkcmortgage.com/information_center/loan_products/va_home_loans/va_streamline_refinance_loan.aspx

 

 

 

Edited December 18, 2015 by danielstevens
links from 2012 no longer work.

[Beaver]

I'm working with Dave Devine at NBOKC on a VA loan. 3.75% and a $5500 rebate is a sweet deal. With some closing costs from the seller I shouldn't have to pay anything and get my earnest money back at closing.

[itsokimapilot]

I pulled the trigger and am working with Dave Devine also. 15 year VA refi at 3%! I'm also deploying next week, so I'll keep everyone posted as how this works with a special POA. So far so good.

[tunes]

I'm working with Dave Devine at NBOKC on a VA loan. 3.75% and a $5500 rebate is a sweet deal. With some closing costs from the seller I shouldn't have to pay anything and get my earnest money back at closing.

I pulled the trigger and am working with Dave Devine also. 15 year VA refi at 3%! I'm also deploying next week, so I'll keep everyone posted as how this works with a special POA. So far so good.

What kind of closing costs associated? Appraisal required?

Edited February 9, 2012 by tunes

[itsokimapilot]

What kind of closing costs associated? Appraisal required?

1/2 percent VA funding fee plus a total of 1,550 in fees which I'm including in the loan 3.125% APR. NBOKC requires a $500 deposit which is credited at closing. So the bottom line is that I had to pay $500 to reduce my rate by 2.5%. I looked around before I decided that this was the best deal I could find. USAA would only offer a 30 year VA at 4%.

And yes an appraisal is required, included in the closing costs I posted above. I haven't completed that yet, so I'm not sure how that's going to go.

[matmacwc]

That seems like a great deal.

[itsokimapilot]

It is a great deal. Turns out that they only require an appraisal for refis from certain banks. Chase, where my original loan is, is one of the banks that they require an appraisal.

[danielstevens]

Hi everybody, I just wanted to say thanks for everyone's interest in what I've been talking about. In the last month we've heard from about a dozen of you, and several we were able to help out.

There will always be situations where we can't help everyone, but we certainly don't mind trying to see what we can do!

Just wanted to show my appreciation for reaching out!

Dan

[daynightindicator]

Bump

Just closed a IRRL VA refinance loan with NBKC. Dan referred me to Amy, who led me through the process from start to finish. She was friendly, knowledgeable, professional, and answered all of my questions quickly and accurately. To fit my schedule, the closing was even done at my house and after business hours by a local notary!

I refinanced from an original loan rate of 6.0% to a 3.75% rate (~3.8% APR), saving approximately $350/month. Closing costs were ~$2700, including an appraisal since my original loan was from Chase.

I will be purchasing a new home in about a month and am eager to work with Amy again for a second VA loan since everything went so smoothly.

I strongly recommend NBKC for your VA loan/refi needs - it was an EASY process that will save me a good deal of money. If you have any questions you can PM me about my specific situation, but I would recommend just talking to Dan who obviously will have more answers than I will regarding the loan process.

[Beaver]

Just closed on my new place, too. Couldn't have gone smoother with Dave Devine and NBOKC. 3.75% for 30 year VA.