Florida Mortgage : Learning Center

When FL Realtors write VA home loan contracts for first time home buying Veterans – they are always concerned with the “seller” fees.  How much does the seller have to pay because the buyer is a Veteran?  Is that fair?

One of the many benefits of being a United States Veteran and purchasing a new home, is not having to pay any junk fee or bank fees usually associated with a FL fixed rate mortgage.  Over the years many have deduced that since a Veteran buyer cannot pay for certain fees, that those fees fall on the responsibility of the seller.  This is simply not true.  The rules are that the Veteran cannot pay certain bank fees. 

There are usually 2 ways to cover the costs of these fees when FL Realtors are writing VA home loan contracts.  One is to, of course, charge the seller.  Everyone knows this method – and its results are unfortunate.  Veterans can’t simply enjoy their earned benefits; but now have to impress additional fees on would-be sellers. 

Another is to have the Lender or bank charge an origination fee shown on their VA good faith estimate.  This is a fee of up to 1%, of the loan amount, that covers the costs of underwriting, processing or document preparation – which would normally be charged on a conventional type mortgage.  No true savings for Veterans with this method.

There is a better way.  Find a bank or lender that will simply not charge the Veteran, or the seller.  The bottom line is the bank would make a little less by covering Veteran costs; but the Veteran wins by not having to shop for a seller willing to give up something more.

This is a way to give back to Veterans who certainly have earned their benefits using the VA home loan.  Realtors writing contracts for their Veteran clients can write without having to calculate additional seller paid fees.  For more information on this; ask your FL mortgage professional for a VA good faith estimate, upfront.

Low down payment mortgages still exist in today’s tighter lending environment.  Once  I recognize a first time home buyer; 3 current FL mortgage programs come to mind.  They are USDA Rural Housing, FL VA home loans, and of course, FL FHA first time home buyers.

Mortgage professionals must inquire whether a first time home buyer is a Veteran or not before beginning to determine a FL mortgage solution.  A qualified Veteran seeking a VA home loan will enjoy no down payments, no monthly mortgage insurance, and seller contributions ( up to 4%) towards the Veterans closing costs and prepaid taxes, insurances and interest.

If the first time buyer is not a Veteran, then determining where the first time home buyer is purchasing should follow.  The USDA Rural Housing program allows 100% mortgage financing but is limited in geographic locale.  Your FL mortgage professional should be able to provide more information with this FL mortgage loan which allows no down payments, no private mortgage insurance and seller contributions of up to 6%.  In fact, the closing costs can be rolled into the loan amount if needed; saving you more money out of pocket.

The next best and most popular FL mortgage program geared for first time home buyers is the FHA home loan.  FHA allows a small 3.5% down payment, seller contributions of up to 6% towards the buyers closing costs and prepaids, and all of this can be a gift from a relative or family member. 

Today’s FL mortgage markets are much tighter than previous years; however, there are still several options for FL first time home buyers to consider while purchasing their first home.  Experience is the difference between spending too much money with the wrong FL mortgage loan.  Get it right – ask for experience.