Home Buying in Reseda>Question Details

Chris Taylor, Home Buyer in Reseda, CA

Is it possible for me to use my VA certificcate on a foreclosed property? I've never used it before.

Asked by Chris Taylor, Reseda, CA Tue Jan 26, 2010

I have yet to use my VA certificate and am looking to purchase or rent to own. So knowing that there are lots of foreclosed properties I was thinking about seeing if use it as I don't have any money down and wanted to use the cert since instead.

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Yes you can Chris. I'm a Veteran too by the way... Thanks for your service! :) But believe it or not, the VA loan may not be your best option. Most people aren't aware that sometimes the government loans can have higher pricing, interest rates etc. The city or county your are looking in may have a first time homebuyer downpayment assistance program and it could be better for you to get a conventional loan and use that or maybe use the VA loan in conjunction with one of these programs. Most agents and lenders don't really know how they work and many lenders aren't approved by the particular government program. The trick is to find an agent that knows. I'm your man but I'm far away in Rancho Cucamonga. You're more than welcome to call me though and If I can't help you, I'll find someone for you who can. :) 909-917-6176
Web Reference: http://www.ivalue.biz
1 vote Thank Flag Link Tue Jan 26, 2010
Hi Chris,

Yes you can purchase a foreclosure property using your VA... as Chris and Roland have mentioned below. If you are considering condos, the complex needs to be VA approved. You can search approved condo developments on the Veteran Affairs site. Regardless if it is a condo or home purchase, just be aware that VA loans have more strict underwriting guidelines limiting what can and cannot be paid for by the buyer. So the seller/bank needs to be willing to cover the required VA seller costs. Also, there are requirements on the condition of the property. It must be in "liveable" condition. Meaning that nothing can be missing such as appliances, cabinetry, fixtures, etc. So you need to find an REO/Foreclosure property that the prior owner has not stripped anything from.

The major advantage that the VA loan has over all other programs is that it is the only program you can still obtain 100% financing (no down payment). You may end up with a slightly higher rate but if you don't have enough for even an FHA down of 3.5%, this can get you into a property now.... and it's a great time to buy, with the overall low interest rates and majorly reduced pricing as compared to 3 years ago at the height of the market. But definitely find a very knowledgeable VA lender to step you through!

I hope that helps!! Good luck to you!
Tara

Tara Steinke
Residential Sales & Appraisals
San Diego
619-384-6014
1 vote Thank Flag Link Tue Jan 26, 2010
VA doesn't restrict how the certificate is used as far as property type. Make sure that you are working with a lender who is very familiar with the VA loan program and make sure that they have closed many VA loans before. I have run into problems in the past with lenders just learning the ropes.


Best wishes and thank you!

Richard Schulman
Keller Williams Real Estate
310-482-0173
0 votes Thank Flag Link Tue Jan 26, 2010
Hello Chris,

You can use your VA certificate, locate a realtor near you if you don't know any I can refer one to you. Your selected realtor will sit down with you and explain the process, connect you with a lender that is well versed in VA Loans. Keep in mind that you will need some money of your own to pay for the appraisal, property inspections and to initially cover your initial deposit even if you request it back in a credit, escrow will cash that check.

Good Luck!
0 votes Thank Flag Link Tue Jan 26, 2010
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