Tag Archive for: Veterans Affairs

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Five Benefits of a VA Loan

VA Loans are mortgage loans guarantee by the United States Department of Veterans Affairs (VA) and are available to eligible Veterans, Active-Duty Service Members and surviving spouses.

For more than 70 years, VA Loans have made homeownership possible for millions of Americans.

Here are some of the benefits of a VA Loan.

Image of a family hanging up an American flagNo down payment required. Qualified borrowers in Michigan can purchase a home up to $417,000 without needing a down payment. This is a significant benefit for those who may not have the funds to make a substantial down payment. In comparison, FHA Loans required 3.5% down and Conventional Loans required 5% down.

No private mortgage insurance (PMI). PMI is required on most loan programs if the borrower is unable to put down 20% of the purchase price. VA Loans are the exception! Since the VA guarantees a portion of the loan, lenders do not require borrowers to purchase private mortgage insurance. This can result in significant savings over the life of the loan.

Competitive interest rates. VA Loans typically offer competitive interest rates which can help the borrower save money over the life of the loan.

Easier qualification. VA Loans have less stringent qualification requirements compared to other loan types, making them easier to qualify for.

Assumable. VA Loans are assumable, which means that if the borrower sells the home, the buyer can take over the loan without having to refinance.

If you have questions about VA Loans and their benefits, please give us a call. We take great pride in guiding our Military Veterans and their families home.

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Military Vets: Get a VA Home Loan

In addition to being one of the country’s leading lenders to first-time home buyers, Michigan Mortgage specializes in helping veterans of the United States military and their families get into their dream homes.

Veterans Affairs (VA) mortgages make it easier for veterans to obtain financing for home ownership. VA loans are available to veterans and active military members. VA loans are guaranteed by the Department of Veterans Affairs and are somewhat easier to qualify for than conventional mortgages.

Image of a family hanging up an American flagVA Home Loan Benefits

VA loans are great because:

  • They can be obtained without any down payment.
  • Mortgage insurance is not required even if you put less than 20% down.
  • The VA does not require a specific credit score for a VA loan.

Although the costs of getting a VA loan are generally lower than they are for other types of low-down-payment mortgages, VA loans do carry a one-time funding fee that varies depending on the down payment and the type of veteran.

According to the VA, veterans who have taken advantage of the program have some of the lowest home ownership default rates, and that the agency also helped 80,000 VA borrowers avoid foreclosure in 2014, saving taxpayers $2.8 billion.

VA Loan Requirements

VA loans are offered to most active duty, reserve or National Guard and veteran service members and even some surviving spouses.

Veterans are able to borrow over $400,000 without any down payment on a principal residence home. According to the VA, almost 90% of VA loans have no down payment.

There’s also no minimum credit score requirement for a VA loan, while most home mortgage loans require a credit score of at least 620 for conventional loans or 580 for most FHA loans. A VA loan can also be used to refinance an existing loan.

VA loans do have specific requirements that most other loans don’t. For instance, all work on the home must be completed before the inspection. Also, there can’t be chipped or peeling paint inside or out, or termites or mold or loose handrails. In other areas, a VA inspection can be a bit more stringent. For example, while most home inspectors merely turn on the home’s furnace to see if it works, the VA requires inspectors to verify that the heat source can keep pipes from freezing.

Are you a vet? Reach out to one of our experienced Loan Officers to learn more. 

This blog post was written by experts at Mortgage 1 and originally appeared on www.mortgageone.com. Michigan Mortgage is a DBA of Mortgage 1. 

Image showing a customer using an ATM.

Finding it hard to save for a down payment?

Making small changes to your habits can make a big difference in your ability to save. Saving takes some pre-planning and discipline and a well-executed strategy.

Here are a few ideas to help you save.

  1. Take it right out of your paycheck and transfer a fixed amount into a special savings account. This is probably the most convenient and practical way to save. Take it right out of your paycheck. Make sure you set up an automatic direct deposit into a savings account that is earmarked for your down payment only. Commit to using this money for a down payment and no other purpose.
  2. Take advantage of special programs including down payment assistance programs. Check with your lender to see what type of down payment assistance programs they offer. See if you qualify with the FHA, the U.S. Department of Agriculture Rural Housing Service and the Veterans Administration. Also, check out local housing authorities, such as MSHDA. If the lender doesn’t offer these programs find a knowledgeable, reputable local lender that specializes in these programs.
  3. Skip vacations for a year. Make if a fun goal to forego any large vacations. Plan a staycation, or a night somewhere, and focus on how great it feels to get closer to your goal.
  4. Lower your expenses. Look at your budget to see what small things you can cut per month. Cut out a coffee per week, make your own pizza on Friday night. If you don’t have a budget, sit down and make one and evaluate it quarterly to see how you are doing. Shop at Costco, Aldi and other discount stores.
  5. Sell your stuff on EBAY or Craigslist. If you have Designer clothes, furniture, antiques, art, gaming devices that you barely use, consider selling them and putting the proceeds in your down payment account.
  6. Start a Side Hustle. Commit to a temporary period of time and put all of the money in your down payment account.
  7. Ask for a raise. If you’ve been thinking about a raise, and feel you deserve one, now may the time to talk to your superior about the value you bring to your organization.
  8. Use gift money. Parents or relatives may be able to gift money to help out a first-time home buyer. Gifts can come from your family, spouse or a domestic partner. Be sure to include the amount of the gift on your loan application and check with your lender as the best way to obtain and track this. To be recognized as a “gift” the donor will have to sign a gift letter saying there’s no expectation of repayment, interest, or anything else.
  9. Be wise with your money. Think about your purchases before you make them. Are there cheaper brands at the grocery store that are the same quality as the premium brand? Are there restaurants that offer the same quality and experience that are a little less expensive? Do you need another tan sweater? Be mindful about your purchases and avoid impulse purchases.
  10. Use your tax refund. Set aside a percent of your tax refund to deposit into your down payment savings account.

For more ways to save for a down payment, reach out to our team at Michigan Mortgage. We’re here to help in any way we can.

Service Rewards logo

Rewarding Home Discounts for Honorable Service

Over the past 20 years, we have had the honor and pleasure to work with many clients that we consider local heroes.

There are those professions, the ones that attract a special kind of person, that make a positive different in our communities and our country.

To honor those heroes and to show our gratitude, we have designed a program to give savings to police officers, firefighters, first responders, government employees, veterans, military personnel and teachers.

At Michigan Mortgage, we are committed to maximizing what our heroes can save on a home.

“This program is special and something we believe in,” said Dave Lehner, loan officer and co-branch manager. “We are committed to our Service Rewards program because the people that go above and beyond to help, protect, teach and serve deserve a break. It takes a special person to sacrifice for our country, protect us from harm and teach our children without asking for anything in return.”

“Giving back is a small ‘thank you’ for all they do or have done for our community and we owe it to them.”

When you register with our Service Rewards program, you are eligible to receive the following discounts associated with purchasing a home.

  • Realtor Fees
  • Mortgage Closing Costs
  • Appraisals
  • Title Fees
  • Home Inspections
  • Home Cleaning, Restoration and Moving

We have partnered with local professionals that feel it is important to pass along savings to these heroes.

“We are so grateful and appreciative to our local partners for their commitment to the Service Rewards program,” said Rob Garrison, loan officer and co-branch manager. “Their discounts are a clear recognition of the sacrifices and value that service heroes bring to our nation and community.”

The process is quite simple. Visit our website, register as a Service Rewards member and we will put you in contact with a local realtor participating in the program.

If you’d rather, give us a call at 231-799-2606 and we can guide you through the process.

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Benefits of VA Loans in Michigan

One amazing benefit for veterans and qualifying military is a VA loan. It’s amazing how many eligible VA borrows are not advised of this product when shopping for a loan. Many lenders do not provide a VA loan or do not have a working knowledge of the benefits this product offers them and their families.

A few benefits include:

1. Zero down. Purchasing a home with no out-of-pocket money can sometimes mean the difference of being able to buy now or having to wait. For some, a zero-down option is the only way that they can ever purchase a home if they are on a fixed income. For others it is a way they can save their money for home improvements or other investments. Regardless of the reason, the VA loan is one of the few loans that allows a zero-down option.

2. Truly $0 out of pocket. On a VA loan, the purchase agreements can be structured whereby the seller pays the closing and prepaid costs (setting up escrow). This allows for a truly zero out-of-pocket loan.

3. No monthly mortgage insurance. The VA loan does not require any monthly mortgage insurance (PMI). When compared to FHA or conventional loans, this can be $100-plus a month savings depending on the loan amount. While VA has a funding fee (which can be rolled into the loan), that fee is waived if the Vet is VA disabled at least 10 percent.

4. A lower credit score is allowed. There is, often times, a misunderstanding that VA loans are difficult to obtain. This is simply not the case. Because the borrower does not have to document cash to close and because the credit criteria is flexible with the VA, these loans tend to be easier to approve and often times are faster to close.

5. Additional incentives. Michigan Mortgage has created a program called Service Rewards whereby we and participating vendors give discounts for things like closing costs, realtor fees, title work and home inspections as a way to show our appreciation for their sacrifices and service!

To learn more about VA loans or our Service Rewards program, call one of our mortgage specialists today.

VA Changes Site Condo Rule

VA Changes Site Condo Rule

In the past, the VA treated Site Condos like any other condo, requiring the entire project be approved by the VA. This is a lengthy and costly undertaking. On May 24, the VA announced, effective immediately, that it will treat Site Condos in Michigan similar to stick-built homes.

Here are a few details that will help your Veterans.

  • VA will no longer review legal documentation for site condominiums. Lenders will be responsible for ensuring that any site condominium proposed as collateral for a VA-guaranteed loan meet requirements for the state of Michigan.
  • Program participants no longer need to obtain a VA condominium ID or submit condominium association documents into VA for approval of site condominiums.
  • Appraisers are still required to use Fannie Mae forms 1073 for site condominiums and complete the Project Information Section of the condominium appraisal form.

If you have questions about VA’s Site Condo loan changes, reach out to Michigan Mortgage. We’re here to help!