VA Home Loan Program Popular With Veterans Gets A Bad Reputation From Sellers
Although the Department of Veterans Affairs has backed a record 1.44 million home loans for veterans and the military in the past year, members of Congress and veterans advocates said on Wednesday that sellers were staying wary of loans guaranteed by VA.
Misinformation about VA valuations, which many sellers think is more complicated than others because homes must meet a series of minimum requirements determined by the department, has contributed to prejudice against VA guaranteed loans.
“Many veterans who try to buy a home using a VA loan find that they just can’t compete,” Veterans Affairs Subcommittee on Economic Opportunities Chairman Mike Levin, D said Wednesday. -Calif., During a hearing.
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Sellers are less likely to accept VA-backed offers than conventional offers, according to a National Association of Realtors survey released earlier this year. While 89% of sellers said they were likely to accept an offer from a buyer using a traditional bank loan, only 30% said they would do the same for a VA-backed buyer.
The fears of sellers are not completely out of place. The average wait time for a VA-led assessment is 14.8 business days, VA Loan Guaranty Service interim executive director John Bell told the subcommittee. Non-VA reviews can take less than two days to process.
The VA has 6,000 appraisers nationwide, according to Bell, but advocates on Wednesday called for a larger workforce and suggested paying workers more as an incentive.
“There is a dearth of certified appraisers, and VA appraisers are even harder to find,” said National Association of Realtors president Leslie Rouda Smith.
Of the association’s 1.5 million members, less than 1% are officially certified to work with eligible veterans, active duty members and military spouses to find the best housing options through the certification program. professional military relocation group, she said.
Higher inspection standards among VA reviewers also deter sellers from accepting VA-backed offers, said Emily DeVito, associate director of Veterans of Foreign Wars. Fifty-nine percent of sellers said stricter inspection requirements reduced the attractiveness of the VA loan, according to the National Association of Realtors survey.
“[The VFW] Also recommends funding VA to conduct public outreach and marketing activities to combat misinformation about the actual term of VA guaranteed loans, ”DeVito told committee members.
Levin said the “vendor apprehension” of VA loan offers is going to need to be addressed.
“We have to make sure people are competitive,” he said.
– Marie Yang is a reporter for the Medill News Service.
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