Simplifying VA Loans in Michigan: A Guide for Realtors

When working with veterans on securing a VA loan in Michigan, I aim to streamline the process, ensuring a smooth transition to homeownership. My Pre-Approval process is thorough, requiring not only employment and income verification but also specific VA Loan Documents. Here is a breakdown of the essentials:

Pre-Approval Essentials:

·        Pay Stubs & Employment History: I collect recent pay stubs and a complete 2-year employment history with places of employment and dates of employment.

·        W2s: Two years of W2s for all employers are needed to verify income stability.

·        DD214 & Certificate of Eligibility: Items I will review if needed to ensure eligibility.

·        VA Funding Fee Status: I ascertain whether the veteran is exempt, often applicable for veterans with a disability rating of 10% or more.

Key Considerations:

·        Seller Concessions: These are defined differently on VA and may be used to pay other expenses. Veterans can request sellers to pay traditional closing costs plus up to 4% in seller concessions.

·        Disclosures & Amendatory Clause: Beyond standard disclosures, VA Loans require an amendatory clause once the purchase agreement is signed and the borrower esigns their disclosures. The amendatory clause allows the EMD to be released back to the borrower if the home does not appraise.

Special Circumstances:

·        Manufactured Homes: Require notification due to additional qualification layers and specific requirements. Please let the lender know when the borrower is interested in a manufactured home or writing an offer on one to ensure their loan will allow for this type of home.

·        Manufactured Homes: AOA (affidavit of affixture) is required to be filed with the SOM and recorded in the county prior to close.

·        Earnest Money Deposit (EMD): It’s crucial the EMDs can be sourced. Cashier’s checks should be directly obtained from the borrower’s account or wired from their account. Underwriting will want to see the EMD coming out of their bank account.

What I need from You:

·        Executed Purchase Agreement, Sellers Disclosure, and Lead Based Paint Disclosure.

·        EMD receipt once available

·        Title Company Contact & Location you intend to close.

The Underwriting Process:

·        Property Inspections: If the borrower is choosing to pay for a home inspection, we want to make sure this happens, and they are satisfied before the appraisal.

·        Locking the Loan & Ordering Appraisal: I will lock the loan rate, order appraisal, and order lender’s title simultaneously to streamline the process.

·        Underwriting: Once Locked in and Appraisal & Title are ordered, the loan undergoes initial approval and condition clearing, aiming for a smooth final approval.

·        Foundation Inspection: When the home is a manufactured home, a foundation inspection may be required. The appraiser generally will determine whether it is required and the inspection will be an additional cost to the borrower. An indication that a foundation will be required is any altercations to the original home. The fees for this inspection can range from $500 +.

·        Water Testing: When there is a well, a water test will be required by VA and this is an additional cost to the borrower to ensure the drinking water is safe.

·        Termite Inspection: These are only required in the following counties: Allegan, Barry, Berrien, Branch, Calhoun, Cass, Hillsdale, Ionia, Jackson, Kalamazoo, Kent, Lenawee, Livingston, Macomb, Mason, Monroe, Muskegon, Oakland, Oceana, Ottawa, St. Clair, St. Joseph, VanBuren, Washtenaw, and Wayne

Important Reminders for Realtors:

·        Transparency and communication are key. Understanding these steps helps manage expectations and facilitates smoother transactions.

·        Encourage your buyers to avoid major financial changes during the loan application process to prevent complications. I will continually remind them throughout the process as well.

Let’s Collaborate:

As a dedicated partner in facilitating VA Loans, I am here to support both our veterans and you, my valued Realtor Partner. This guide outlines our shared journey toward successful homeownership for Michigan’s Veterans. For further details or specific queries, don’t hesitate to reach out!

Angie Anderson MLO

#angieandersonmlo

aanderson@onetrusthomeloans.com