update on using a VA loan

[happyscooter]

I can't find the old thread. We are selling my parents house, there is a contract. The guy is getting a VA loan which I knew would be a problem, as we aren't going to fix anything and he knew that. They have come back with a few simple things but one not quite so simple. If he backs out, we can't get the earnest money because he couldn't get funding. OK, I understand that and the house has still been shown even though we had a contract. But seriously, the guy can't get any other loan because he has NO money for a down payment. I'm having a hard time understanding how someone who has been in the military for 2 plus years, not married, I would assume lived in the barracks, etc... couldn't manage to save $1500-$2000.
Um, wouldn't that come out to around $100 a month?
Vent over. That was mild for a Friday don't you think?

[Deleted]

I don't disagree that he should have saved the $$$, but . . .

What is the "not so simple thing" that has to be fixed? If it's a deal-breaker, it must be serious. You do know that you will probably have to disclose it to any other buyers?

[Deleted]

I know people that have been working for 5-10 years and don't have a dime saved.

It's called living paycheck to paycheck... literally!

I have a friend that we always have to schedule outings/dinner plans/anything that involves spending money around his payday.

Karma for you and hopefully you get to sell the house.

[happyscooter]

Kitchen cabinet under the sink needs to be replaced.

[973beachbum]

Apr 22, 2011 7:07:21 GMT -5 happyscooter said:

Kitchen cabinet under the sink needs to be replaced.

If it were me and that is the only thing between me selling the house and not selling the house I would replace the stupid cabinet!

How much does it cost you to hold the house every month? It has to be at least a much as a stupid $200 cabinet.

[happyscooter]

Yes, we'll replace it. But you know when you do that, it leads to something else which leads to something else which leads to something else.........

I guess my vent was, no other loan could be obtained (not he CHOOSE to go with a VA, he HAD to) because of the down payment. It reminds me of the threads on here where everyone is saying 'if you can't save $2000 in 2 years, can you afford the homeowners insurance, the taxes, the PMI, etc...'

[Deleted]

Apr 22, 2011 7:43:59 GMT -5 happyscooter said:

I guess my vent was, no other loan could be obtained (not he CHOSE to go with a VA, he HAD to) because of the down payment. It reminds me of the threads on here where everyone is saying 'if you can't save $2000 in 2 years, can you afford the homeowners insurance, the taxes, the PMI, etc...'

I am sure he is like some of my family members when they find out what we pay in rent for our area. They usually go: That is a mortgage. Why don't you get a house?

In their mind all that comes with owning a house is the mortgage; they don't see the property taxes, the things that brake down and need to fix, upkeep/maintenance, insurance, etc.

[happyscooter]

If I was in the military, living on base, eating for free, uniforms provided (not buying clothes), not paying utilities or whatever, I think I could afford to save $2k over 2 years. Isn't the minimum time to be in the military 2 years? It reminds me of the HGTV shows where the couple is living in the parents basement, she is an office manager and he is an IT consultant. They have lived there for 1 year and have saved $5k for a down payment. Holy cow! You aren't paying rent or utilities and you saved a whopping $5k? In 1 year? And they are proud of that.

[Deleted]

Apr 22, 2011 8:06:01 GMT -5 happyscooter said:

It reminds me of the HGTV shows where the couple is living in the parents basement, she is an office manager and he is an IT consultant. They have lived there for 1 year and have saved $5k for a down payment. Holy cow! You aren't paying rent or utilities and you saved a whopping $5k? In 1 year? And they are proud of that.

Hey might be more to that story.
If I were to move in with my parents, live in their basement (we were considering it at some point) we would save $20,040/year and that is not even including gas/electricity/renters insurance, etc.

But guess what, we would most likely focus on paying
-> 7K credit card
-> 15K car loan

So we might end up at the end of that year with only having saved 5K but a major part of our debt gone. So maybe they focused on paying down their debt while living with their parents.

[973beachbum]

Apr 22, 2011 7:43:59 GMT -5 happyscooter said:

Yes, we'll replace it. But you know when you do that, it leads to something else which leads to something else which leads to something else.........

I guess my vent was, no other loan could be obtained (not he CHOOSE to go with a VA, he HAD to) because of the down payment. It reminds me of the threads on here where everyone is saying 'if you can't save $2000 in 2 years, can you afford the homeowners insurance, the taxes, the PMI, etc...'

Yeah that does happen. I would just hope that at this point in the sale the agent would have the contract locked up so that it is in the final stages and nothing could happen like that.

I know I am an optimist. ;D

[Deleted]

Will they let you credit $200 or so for the cabinet? I can't remember if VA allows that.

[Deleted]

Will they let you credit $200 or so for the cabinet? I can't remember if VA allows that.

[alabamagal]

I think you should be stunned that he has no money saved and is trying to buy a house, not so much that he doesn't save any money

[rileyoday]

Your buyer will not have to pay PMI. Thats a savings for him.
Also I think they may put his closing costs in the loan. He will go to closing with Zero cash.

[raeoflyte]

I was at a VA loan training a couple weeks ago and the VA reps repeated over and over how their military people 'couldn't' save up money for a down payment/closing costs.

I don't know what those bottom of the barrel enlistees get paid, and my parents really thought I was being unreasonable when I complained about the attitude, I don't know. Maybe they really can't.

When your deployed in a combat zone, your earnings are tax free, and I'm even more surprised when I find someone like that who hasn't at least saved what they would have paid in taxes.

[phil5185]

I was at a VA loan training a couple weeks ago and the VA reps repeated over and over how their military people 'couldn't' save up money for a down payment/closing costs.

LOL - Drive thru the parking lots on Base - you'll see where the money is. Those Big Dually Diesel 4-door 4WD Trucks w/ cool wheels/tires sell for $50,000 or $60,000. And with Zero Down, 15% rate ?

[Deleted]

I choose VA loan over conventional

0 down vs 60k+

5.75% vs 5.15%

Total out of pocket was $ 2335 vs 60k +

I could have done the conventional...but since i had the option.....it didnt make sense

Sometimes it IS a choice

[Sum Dum Gai]

Junior enlisted guys really don't make all that much, however he should have been able to save something. Like you said, he's been living in the barracks and on a meal card, his only bills each month should be gas, car insurance, cell phone, and maybe a car payment. The problem is, like Phil said, quite a few of these guys buy a brand new car practically the second they graduate from basic training, so those car payments can hurt. Throw in buying toys like gaming computers, stereo equipment, video game systems, motorcycles, basically whatever strikes their fancy the day after payday, and you can see where their money goes.

Keep in mind a lot of these guys are 18, 19, and 20 year olds that have basically never had to live on their own or support themselves. The military provides for almost all of their actual needs, so practically their entire paycheck can be blown on whatever. It would be like giving your teenager a few thousand a month in allowance while they lived with you and you didn't charge them for rent or food. If you don't think they're going to blow most of that on pretty questionable purchases you've probably got another thing coming.

[ty]

Apr 22, 2011 6:48:21 GMT -5 happyscooter said:

I can't find the old thread. We are selling my parents house, there is a contract. The guy is getting a VA loan which I knew would be a problem, as we aren't going to fix anything and he knew that. They have come back with a few simple things but one not quite so simple. If he backs out, we can't get the earnest money because he couldn't get funding. OK, I understand that and the house has still been shown even though we had a contract. But seriously, the guy can't get any other loan because he has NO money for a down payment. I'm having a hard time understanding how someone who has been in the military for 2 plus years, not married, I would assume lived in the barracks, etc... couldn't manage to save $1500-$2000.

Um, wouldn't that come out to around $100 a month?
Vent over. That was mild for a Friday don't you think?

If he was disabled hey do offer home modifications and repairs for those that are in need of assistance. If he didn't save the money while bing in the military, then no one to blame but himself.

If he needs a new cabinet for a sink, go to home depot and buy one for a couple of 100 and do the work yourself. Installing a sink is a pretty simple thing to do.

He was after all in the military. one would think he would be able to read instructions and follow them.

[Deleted]

Your job isn't to pass moral judgment but to sell the house.

I agree with Beachbum. If the only thing standing in the way of the house sale is the cabinet I would just suck it up and replace it.

[2kids10horses]

If you didn't want to sell to someone who was going to get VA financing, you didn't have to sign the contract.

[phil5185]

If you didn't want to sell to someone who was going to get VA financing, you didn't have to sign the contract.

I don't budge from my asking price.

[❤ mollymouser ❤]

E-1s make $1467.00 per month.

[Gardening Grandma]

Well, people are still buying with no money down. My son just sold his house to a young couple, both with good jobs, no kids who had to get 100% financing and asked that he pay the closing costs...... It was a conventional mortgage.

How could a young working couple not manage to save a down payment?

[shelby]

"LOL - Drive thru the parking lots on Base - you'll see where the money is. Those Big Dually Diesel 4-door 4WD Trucks w/ cool wheels/tires sell for $50,000 or $60,000. And with Zero Down, 15% rate ? "

HaHa so true I dated a guy in the navy had one of those beasts, I think it is a requirement. He was the worst money manager ever. But spent most of it on me

Also have a good friend her husband is special forces, he drives a huge truck and they spend like crazy mostly him. They bought a 2000sqf house VA 0 down no kids

[happyscooter]

Well we took care of the problem that I thought would be the biggie. The kitchen cabinet. It turned out to be in front of the cabinet. The other was a little bit harder to fix but we took care of it. Waiting on the re inspection. We are supposed to close on Friday. If not, we have a cash offer for a little less that we are selling for now. But we won't pay a Realtor, it is a friend of someone. Hopefully, this will take care of it.
As far as why we signed a contract. Since probate was closed, there no longer is an executor to make decisions. We all had a say in what we did. If the executor would have just said 'OK, this is what we are going to do', it would have been fine by me. Unfortunately, we had someone who couldn't let go of a piece of Tupperware, much less sell the house.
Parents, please don't do this to your children. Emotionally, I am exhausted. Physically, I am exhausted. Mentally, I am exhausted.

[hoops902]

"If not, we have a cash offer for a little less that we are selling for now. But we won't pay a Realtor, it is a friend of someone. Hopefully, this will take care of it. "

Do you have a realtor right now working to sell your home? If so you can't just "not pay them" because a friend wants to buy the house. I don't remember if you were selling it yourself and just paying the buyer's agent or what.

[pig]

VA loan stipulations are not very strict. If they say it needs to be fixed it's a safety issue. Would you feel right selling a property that has safety issues??

[happyscooter]

Hoops, yes we have it listed with a Realtor. He didn't show it to these people. Our contract is up in about a week with him. I have no problem paying him for getting us a buyer. As a matter of fact, he got us more money than we were asking. Yes, the items the VA wanted fixed were safety issues. I have no problem with that.

[hoops902]

Apr 25, 2011 9:06:09 GMT -5 happyscooter said:

Hoops, yes we have it listed with a Realtor. He didn't show it to these people. Our contract is up in about a week with him. I have no problem paying him for getting us a buyer. As a matter of fact, we got us more money than we were asking. Yes, the items the VA wanted fixed were safety issues. I have no problem with that.

Your offer from these people came while he was the realtor on your listing though. Someone else can correct me, but the fact that he didn't specifically show them the house, and that his contract is up soon...is irrelevant to the fact that you received an offer on your home while you had contracted with him to sell it. If you choose to take that offer from a friend you still owe your realtor the commission that you had agreed upon paying him.

The realtor commission is not contingent (usually anyways) on the fact that they specifically bring in the buyer to you. It's contingent on you selling the home from an offer that you received or an agreement you came to with someone while they were listing the home, or subsequently through an offer that came about from the work they did while they listed the home. You've indicated you have received an offer from a friend, and your home is currently under listing with the agent. If that offer ends with a deal, you will owe the agent their commission.

You might want to look into this if you end up going with that offer to save yourself some legal issues. I know people in almost this exact situation who thought they were getting a deal by selling to a friend and just "holding off" until their listing contract expired. It doesn't work that way.

ETA: THat's one of the biggest reasons they have you sign a listing contract in the first place. So that you specifically can't pull something like that. It's their exclusive listing...exclusive meaning you can't do it yourself either. (unless of course you got some kind of exclusion in your contract with them allowing you to sell it yourself while they have the listing and withhold commission)