Getting a VA loan..are SS and REOs difficult to close on? and timeframe for both? Thanks

Asked by Usmc_wife, Temecula, CA Tue Jan 11, 2011

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Deborah Garv…, Mortgage Broker Or Lender, San Diego, CA
Tue Jun 28, 2011
There is absolutely no reason a VA loan should take 45-60 days to close. Our average loans close in 9 to 20 days. VA will be on the longer end of the range because the appraiser has up to ten days to complete the report. Otherwise, using VA all the time on SS and REO...just did one for my son in Murrieta. Let me know if I can assist you!
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Raschel A. K…, Agent, Carlsbad, CA
Tue Jan 11, 2011
A VA loan is going to take 45-60 days to close. Short sales you could wait 6 months for a response. Banks you can usually close in 30-60 days. Good Luck to you! Congrats on having a VA loan!

Raschel A. Kloos, Realtor 01242504
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Chris Fechete, Agent, Myrtle Beach, SC
Tue Jan 11, 2011
Not at all, I closed several VA loans last year and most of them with REO and Short Sales listings. The key is to have a good lender and an Realtor that understands and are experiences with VA. Feel free to contact me if you need help. A big thank you to you and your husband for his service!

Best regards,

Chris Fechete
Realtor®, MBA
Cell: (760) 500-5326
“I appreciate your confidence and I reward you with my loyalty.”
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John Linthur…, Agent, Carlsbad, CA
Tue Jan 11, 2011
Using your VA eligibility of little to no money down for a purchase of a home is one of the great entitlements of service, particularly now that most competing loan instruments have increased equity positions and other underwriting standards. My advice though would be to not exclusively shorten your sights to bank owned and short sales because often they are fraught with inadvertent non cooperation. The VA guaranteed loan has restrictions for instance on working components in a house. An REO typically requires an AS Is addendum. That creates a conflict. Often short sales have multiple lenders and when buyers costs are required to close a transaction, you have a competition for available dollars that can get tossed by unsympathetic lien holders at the eleventh hour. Furthermore both these sought after purchases often are competitive with two and more offers. When the goal is to close the home with the least amount of resistance unfortunately the VA offer may not take priority.

Thus why I encourage you to pursue the more conventional opportunities that are out there. You will find in the end your purchase price and level of satisfaction will at least be equal if not more favorable than the ambiguity of ‘distressed’ inventory

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Joan Wilson, Agent, San Diego, CA
Tue Jan 11, 2011
Both are more difficult than a regular sale, particularly with VA financing, but not impossible. You should also look at regular sales. There are some great deals out there that would be very easy to close with a VA loan.

Let me know if I can help you in any way!

Joan Wilson (Realtor, SRES, Ecobroker, Certified REO, HAFA, and Short Sale Specialist)

Prudential California Realty
Direct Phone: 760-757-3468
800-975-7481 x 111
Fax: 760-946-7894
License # 01341483


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Liz Saldana, Agent, Carlsbad, CA
Tue Jan 11, 2011
Great question and great answers have been posted! Just to add a few notes...Short Sales can be lengthy as the buyer does have to wait for lender approval and your timeframes for closing (& your loan) do not begin until you have that approval! You may see some homes where they are Back on the Market and have lost a buyer but have Short Sale Approval, there still could be a waiting period as some banks have to start the process all over with a new buyer, fyi.

REO's can be difficult to get into as there can be multiple bidding offers and the bank can take 1-2 weeks to review these offers. As mentioned previously, the condition of the property and what the bank is willing to do for a VA buyer is extremely important to know upfront and can save you time in your home shopping experience. So, it's lots of waiting therefore it's important to have patience when buying a home! Once you have an acceptance (& Approval if a Short Sale) my experience recently with VA loans has been a 30-40 day closing!
Hope this helps!!
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Jerry Heard, Agent, San Diego, CA
Tue Jan 11, 2011
First of all I want to thank you for your family's service to our country. It is greatly appreciated.
There is a difference in buying short sales and REOs. REOs are almost like a regular purchase except the lender owns the property. When you make an offer it is presented directly to the lender/owner and they generally respond within a week to 10 days.
At that time an escrow is opened and you can close within 30 to 45 days depending on your lender. If you are pre-approved the time frame will be on the shorter side.
A short sale is a lengthier process. The bank is not the owner so the current owner has to accept your offer then present it to the lender to get their approval to accept a payoff that is less than what is owed on the property. Depending on the lender this can take from 2 weeks to several months. I have know them to take as long as a year but that is the exception. If the listing agent has a pre-approved short sale from the lender, and this is becoming more common, the short sale approval will be on the shorter side. Once the lender accepts the short payoff, escrow is opened and you can close within the regular 30 to 45 time frame.
I have represented buyers in several short sale and REO purchases and would be happy to discuss the process in detail with yo at your convenience. Please feel free to call or email me at your convenience.

Jerry Heard
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Matt Puzz, , Phoenix, AZ
Tue Jan 11, 2011
Your need to use a VA loan for the purchase of an REO or a Short Sale home has no bearing on the length or difficulty of the sale based on the property type. A VA loan may take longer due to the Appraisal being ordered and the VA appraiser having up to 10 days to complete and submit the appraisal to the lender. The VA loan will also take into account the condition of the property and if there are major appliances missing, the condition of the structure and flooring, as well as the plumbing, A/C heating, and electrical, pool if necessary.
A short sale will take longer for the most part because the 3rd party bank must approve the transaction and there is a loss mitigator involved as a liason between the realtors and the entity that actually owns the note on the property. An REO property is already owned by the bank and there are usually fewer hoops to jump through than a short sale.
I encourage you to use your VA loan, it is one of only two loans out there that has no down payment required and no monthly mortgage insurance, and the interest rates are amazing right now. Some people do not have the full use of the VA loan benefit so your case may be different than others so it is best to talk to a lender.

If you have any other questions I will gladly answer them for you. I have a partner that is a licensed loan originator in California, I am licensed in Arizona.

Warmest Regards,

Matt Puzz
Licensed Loan Originator
Amerifirst Financial, Inc.
1910 S. Stapley Drive #209
Mesa, AZ 85204
Direct: 602-410-9333
Office: 480-682-6617
Fax: 480-344-3687
NMLS# 213777 AZ LO-0915068
Apply Online:
In California, dba as Citizens Choice Mortgage
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Raquel Unger, Agent, Irvine, CA
Tue Jan 11, 2011
If you have a lender that is experienced with V.A. loans...( my son-in-law is on C.P) when I found them= (daughter and her husband) an REOhome in took about 45 days start to finish. Short Sales are a bit trickier as your lender cannot lock in a rate or start the process till the bank agrees to the price and negotiations are all complete. This can be a lengthy process. This could also apply to a Fannie Mae property.

I work in Oceanside ..please contact me with any questions you have.
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SeattleHome.…, Agent, Seattle, WA
Tue Jan 11, 2011
Short sales are difficult sales, and take much longer in most cases. REOs are a bit closer to a standard transaction, with a few hitches.

Your issue with a VA loan may be the condition of the home. VA appraisers are notoriously picky about the home's condition, and won't allow the sale to close in many situations if it's not in good shape. This may disqualify a lot of REO homes, because the bank will not be doing repairs to the home. They may not accept a VA or FHA offer.
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Dallas Texas, Agent, Dallas, TN
Tue Jan 11, 2011
REO can take approx. 60 -120 days close AFTER you receive an executed contract. If you are in time crunch may not be the direction to take. Your buyers agent can review all this with you

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
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