When using a VA home loan in Westchester County NY is the earnest money payment still 10%?

Asked by Pat O, 10606 Mon Nov 19, 2012

I'm utilizing the VA home loan option so I can minimize my out of pocket expenses, but the 10% down for earnest money is going to defeat that purpose. Do I have any options, or was I better off not moving back home to NY?

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Jessica and…, Agent, Bronx, NY
Mon Nov 26, 2012
Very Important to know:

1) VA will allow for up to a 4% Seller's concession to assist you in paying closing costs
2) what ever you put down to convice the seller you are serious, you will get back at closing
3) I recommend as Mark pointed out to use a number you are comfortable with. $5,000, $10,000 etc. Since there is no requirement for a DP, the amount down is up to you and the seller agreeing
4) Downside to VA loans which seller's fear- they tend to take longer to clear than a conventional and as with FHA loans, the sellers have to agree that if the property doesn't appraise, they have to refund the purchaser the downpayment. (I feel this should be in all contracts as a clause any way)

In short, I don't see the downside in this market. Yes, the loan may take a little longer to close, but at the same time, how much longer really makes a difference? MArk I know has closed VA loans within 7-8 weeks.
0 votes
Jim Simms, Mortgage Broker Or Lender, Louisville, KY
Mon Nov 19, 2012
That is the seller’s call, I have had a few issues in the past where the seller did not agree to signing the VA amendatory clause, they did not want to sell to a buyer using a VA loan. I suspect the bad wrap is from long ago when some lenders charged more to the seller if the buyer went VA. Any of you other lenders still do that?

Not the case around here that I am aware of. We are even located near a major military base with lots of VA traffic. Can still be a little touchy.

The VA does not require a GF deposit, same as all other loans, it is simply an agreement between the parties. In Kentucky the contract isn’t enforceable if there is no deposit, but in the past couple of years deposit or no deposit doesn’t seem to keep either side from walking away from the deal in y area. The parties are either going to show up at closing or they won’t, deposit or none.

Jim Simms
NMLS # 6395
JSimms@cmcloans.com
Financing Kentucky One Home at a Time
Web Reference:  http://jamessimms.com/
0 votes
Jim Olive, Agent, Key West, FL
Mon Nov 19, 2012
Remember that VA caps only apply for purposes of downpayment. A Vet can buy over the VA cap, but has to put down a downpayment (I have most often seen 20%) on anything over the cap (ie: 0% down on the first $417k and then 20% on the rest)...
0 votes
Mark Fisher, Mortgage Broker Or Lender, Bronx, NY
Mon Nov 19, 2012
Hi Pat, It really depends on what the seller and sellers attorney will feel comfortable with. Technically you can put 0% down at signing of contract but many attorneys will advise their clients not to, since "you have no skin in the game" and can just walk away without loosing any money. I just did a VA loan and the buyer put 5k down at signing of contract and then it was credited to his closing costs at the closing table. I would speak to you attorney and see what he could negotiate for you.
Web Reference:  http://www.markfishernyc.com
0 votes
Anna M Brocco, Agent, Williston Park, NY
Mon Nov 19, 2012
Thank you for your service. Do you have sufficient entitlement for the amount asked....See links for helpful information information; also consider shopping around.... http://www.benefits.va.gov/homeloans/ http://www.benefits.va.gov/homeloans/veteran.asp
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