VA Renovation Loan Myths

There is a tremendous buzz around VA Renovation Loans today . They are similar to an FHA 203K repair loan but available for eligible VA beneficiaries (active duty or prior military). Many people don’t know these loans exist. Some naysayers even refute the program’s existence.  According to the VA Handbook 26-7, The Alterations for Improvement and Repair Loan Program ( VA Renovation loan) it is possible for a veteran to use their benefit to buy and include material and labor repair costs.  Other lenders are starting to offer a  VA Renovation products with limited capabilities. Research the facts on what you are being served andrely upon experience in this lending space.

Evolution of VA Renovation

Our personal experience with Alterations for improvement and repair started with our move to loanDepot almost 5 years ago, (previously imortgage). Prior to our arrival at loanDepot, no other lenders were offering the VA Renovation loan. We moved companies solely for the availability of this product. Having three local military bases and veterans that needed access to this product, our community was entirely underserved.

Four years later, we’ve transitioned our existing renovation loan leadership to a team of top performers of VA Renovation loans. Rated #1 VA Renovation production at loanDepot for the company for the last 4 years running. Dubbed number one VA Renovation production team in the country. Our true passion for the product is serving those who have served. It is our specialization to offer loan options for homes that would otherwise be out of reach for veterans. 

“The company has changed a lot about what we can now offer our veterans. We have come a long way with this product and proud to assist those who have served. Our commitment is providing Veteran guidance to using our product” – John D. Adams, Jr. 

Limited VA Renovation (Alterations for improvement and repair)

Not all companies will have the full VA renovation product. We, in fact, started out with similar limitations. The limited VA Renovation loan will only allow for similar repairs in the FHA 203k limited repair program ( Formerly streamline ). These repairs would include but not limit to cosmetic repairs like flooring, roofing, wood rot, kitchen remodeling,  bathroom remodels, electrical repairs, and appliances. Many will not allow  a Health, livability, Hazard or safety repair. Very similar to the FHA 203k limited program with a 35,000 cap.  Just like a regular VA loan the program will allow for as little as 0 down ( 100% Financing). You do have options to do more with the right company if they have the Standard VA Renovation program! 

Call us to guide you home! 904-639-5571

We used to be the only ones offering this product but that has all changed due to a recent circular from the VA completing a 6 page document on the VAs renovation loan procedures ( Alterations for improvement and repair loan )

Renovation loans for manufactured homes?

I’ve recently been asked if you can do a 203k, or VA renovation loan on a manufactured home. The simple answer is yes! There are a few restrictions to keep in mind but it is possible to finance and include some repairs in with a purchase or refinance of one of these structures that requires fixes for financing. 

The first thing to know is that typically most mortgage companies require the Home to be a double wide or larger. Single-wides generally are not able to be included with renovation finance. According to HUD, these structures need to be 1976 or newer also. The structural tie down or, foundation inspection, is needed to show the structure is permanently affixed to local code. The title will need to be retired to the land and permanently affixed to the property. It cannot be a moved manufactured home to a new lot. 

The inspections needed are the foundation certificate, (if on a well) a pressure and potability test, and though it may not be required, a septic test is recommended (if on septic). A pest inspection, like a wood destroying organisms renovation is required on VA Renovation loans and on FHA only if the appraiser flags the appraisal for this it, would become a requirement. 

FHA 203k and VA renovation loans limit repairs on manufactured homes to $35,000. including contingency reserve and other soft costs. You are not allowed to conduct structural improvements on these loan products with manufactured housing either. Many lenders have overlay for this product which are exclusions for what they allow on this product. You should check with them on special nuances with respect to credit score and qualifications but the HUD Guidelines mirror other credit guidelines and repair guides for a limited (formally “streamline 203k” guidelines).

Buying a home and including improvements can be done! It’s more difficult to do without using professionals familiar with the ins and outs of the process. Doing these loan products also in conjunction with a Manufactured home can have more intricacies but can be done. It is possible to buy and include all repairs in the purchase and get a good deal on a home! Let us know what we can do to help bring you home! 

Case study in renovation lending

A case study in renovation lending on a Jacksonville Florida home located at 13723 Alesbury Ct Jacksonville FL 32224 reveals people are not just fixing a home to minimal standards but modernizing a home and extending new life into established neighborhoods and creating an exciting alternative to buying a track built home. Here they have upgraded the showers and baths with modern fixtures and amenities you would see in a brand new model home. Stainless steel appliances, granite countertops, decorative glass backslashes, wood cabinets, new roof, new ceiling texture, AC and flooring have essentially give this tired home a brand new look.  Here they have used renovation lending to create a much more maintenance free home since everything on the home has been brought up to much better standards that you would expect in a home in this neighborhood and is not an over improvement.

Renovation lending allows you to not only rehab you home to minimal standards but also allows for preference work to personalize the house to conform to your needs. This interview with TCI construction shows their “Buy Smart program” where they specialize in home modernization instead of minimal repairs to meet mortgage backed security investor guidelines for FHA 203(k), Va Renovation or Homestyle renovation loans. Watch and see the improvements they have made illustrating what can be done in your home revitalization through renovation lending. See more on TCI on their website at http://tci.construction/

There are several options in repairs as well as loan choices. VA renovation, FHA 203(k) and Conventional lending types have a product for almost ever need in this space. The important part is speaking with someone familiar with these products as havinng a lender familiar with the process is key to a smooth process. We hope this information is helpful in realizing all of your renovation loan options. Please let my team know how we may be able to help show you and your family a better way home.

VA Renovation loan options

Wouldn’t you like to provide your veteran customers financing on virtually any home? Could you help more veterans if you could buy the property in the condition it was in and have repairs included in the financing and done after closing? Now you can do all of this with new programs offered for VA Renovation. VA Renovation loans are not common and very few people offer them. VA Renovation loans offer Veterans and surviving spouses the option to buy a home and include up to 35,000 in cosmetic repairs that may otherwise prevent a veteran from qualifying for a home because of the property conditions. This product allows veterans to buy a home and either use these funds for cosmetic challenges, appliances, roofs, Wood destroying Organisms, HVAC and other items that affect the homes livability and minimal property standards set by VA. Few lenders offer this product so there are plenty of misconceptions from lenders and realtor partners out there that would try to push a veteran away from this product or a home that needed repair because they do not know or haven’t heard this solution exists. Be more informed of options that would otherwise make distressed homes out of reach dfor our veterans. Find out more about imortgage, The John Adams Team and VA renovation loans today!

Renovation loans are not scary – More renovation loan options take the fear out of renovation lending

Nightmare on elm street renovation pictures

Nightmare on elm street renovation pictures

The above picture is of the classic movie home from “Nightmare on Elm Street”. Someone actually bought and renovated it – read about nightmare on elm street renovation.
We tend to help a lot of customers that have already met a “scary lender” who didn’t know the in and outs of renovation lending or simply didn’t have the expertise or products to back them up on execution. We have even saved a few deals from other “renovation experts” this year that just didn’t spend the time with the customer needed to alleviate the fear of the process up front and explain how the solution would work. Don’t get scared away from the renovation process. We have the time talent and resources to help you and your customers through the process.
We are enthused to work for the only company with the most comprehensive selection of renovation products that include both FHA 203k loans (streamline and full), both  Fannie Mae Homestyle Renovation and Freddie Mac Renovation loans, as well as the only present company offering a true VA renovation loan. We control our own contractor draw process and have special processing for these loans to help aid in faster closings and a better experience for all involved.  Most companies offer maybe two products and try to cram you into the product guidelines that fit their guidelines and not the customers needs. Sometimes it is with someone with little to no renovation process knowledge. It does not have to be a nightmare on Elm Street, Allow us to help!
Looking back on last year you know the Homepath loans have been put into the grave but don’t fear renovation like the night of the living dead. Homepath still offers incentives through their Ready Buyer programs and are perfect for other loan solutions. Read up on Ready buyer incentives and Homepath properties here.  FHA 203k and FNMA Home-style are still here and been around since the late 70s. Also there are now VA renovation loans. Freddie Mac loan options have also recently opened the door for almost any renovation loan you need with the right lender to help every situation.
You can use these various renovation loan products for distressed sales as well as refinance tools. The best thing is that it opens up the possibility of renovation to Primary occupants, Second home and Investor properties on virtually any home not just foreclosures. Buy any home as is and get the work done after closing! See our renovation checklists and other home-buyer tips and checklists here. 
We have a couple of examples below with pictures of recent home where there was preference work as well as quick closings on auction properties where we had to get the loan to close in as little as 13 days.  We’d like to do that every time but know it’s usually about 33 days for a renovation closing especially with new TRID guidelines.
  Please come back to the site often to see our projects. Renovation is far from dead and helping all kinds of folks get their dream homes ….. Don’t let your purchase or refinance be a Halloween horror night …. Call the John Adams Team for your next home loan and please forward our information to someone you know who could use our help!

Dont TRID on me! TRID checklist and changes. FHA 203k, Homestyle and VA Renovation lending experts

John Adams and Tu Mullins discuss the changes and impacts TRID is having on renovation lending the renovation lending form and how it affects you.

Don’t TRID on me. Hi I’m John Adams – and I’m Tu Mullins. Today’s renovation minute is about TRID. This is part of the truth in lending disclosure changes for simplification of the settlement process. These upfront disclosures provide a simplified way to assist consumers and to disclose up front the fees and the account for them in a similar way prior to and at closing. This is going to require lending professionals to capture more data upfront from all partners (Title, Insurance, and other affiliated costs for settlement providers). Here are some handy forms that will help you in the process for TRID and other helpful lender checklists for the loan process and a renovation loan checklist.

https://johnadamsteam.com/home-buyer-education/

TRID has also caused some shakeup with the largest renovation national lender who is not prepared on a systems basis to deliver these products to consumers as of the TRID deadline. This is causing some lenders to pull out of renovation lending and have paused their offering of renovation loans for an undetermined amount of time. Non-bank lenders like imortgage have been nimble and able to respond to systems issues and consumer demand to still offer these products through the TRID transition. As always we are here for your resource with any renovation lending questions you may have.

More info at: http://www.consumerfinance.gov/regulatory-implementation/tila-respa/

How is your income a liability – FHA 203k, Homestyle and VA renovation loans explained


Is your income a liability? John Adams and Tu Mullins discuss the importance of income and the documentation process of these items up front to help you navigate through FHA 203k, Homestyle and Va renvoation loans. These important first steps let you know how much home you can afford and make sure your documents are in order up front to avoid problems in the underwriting process.

Sourcing deposits – Get your assets to closing


Seasoning and sourcing deposits are among the most common hangups when clearing underwriting conditions on documentation for assets, gift funds. What is  sourcing and seasoning funds for closing? John Adams ( NMLS 442266 ) and Tu Mullins ( NMLS 657663 ) go over the most common questions that can help your borrowers navigate their assets to closing. Get the facts from the John Adams Team.

Property Type Matters FHA 203k Homestyle and VA renovation loan specialists

Does Property Type Matter? John Adams NMLS 442266 and Tu Mullins  NMLS 657663 discuss different property types and the financing available to repair almost any home regardless of condition with FHA Conventional and now even VA renovation lending products. Call us for information on renovation loan options. It’s financing with all the fixings.

USDA Announces Funding Fee Changes Effective October First 2015

USDA mortgage loans are so popular (especially in Georgia Florida and Alabama) because they allow first time or subsequent homebuyers to purchase a primary residence with no money down and with low monthly payments.

The USDA National Office just announced on June 16, 2015 that effective with guaranteed loan obligations on or after October 1, 2015 through September 30, 2016, the up-front USDA guarantee fee is increasing from 2.0% to 2.75%.
This USDA up-front fee is financed on top of the base loan size just as it is done for VA and FHA loans so the change does not require the buyer to bring additional money to closing but it will make their payment a few dollars more per month. The Annual Fee will remain at .50% which is factored into the monthly payment. If you are looking to purchase soon & would use a USDA loan, let’s get the USDA commitment prior to October 1! Learn how the USDA Annual Fee is a little different from traditional PMI here.

The Up-Front USDA guarantee fee increase does also apply to USDA Streamline or Pilot Refinances.

The official USDA Rural Development unnumbered letter dated 6/16/2015 “Upfront Guarantee Fee and Annual Fee Schedule Effective October 1, 2015″ can be read here and is available under “June 2015″ on this page. Keep in mind that a loan is obligated when the mortgage lender has fully underwritten the file, USDA has approved a complete loan package, and USDA has issued form RD 3555-18 which is the “Conditional Commitment for Single Family Housing Loan Guarantee” to the lender.

Link to the usda’s website and announcement about this