Along with a slew of benefits with the VA loan like no mortgage insurance (which keeps your monthly mortgage payment lower), very competitive interest rates (sometimes better than conventional rates because the US Goverment guarantees the loan), and 100% financing (means no down payment required) as a veteran you can still take advantage of the Home Buyer’s Tax Credit that was authorized by President Bush and reauthorized by President Obama.

For the rest of us who do not have VA loan elibigibility the opportunity to take advantage of the home buyer tax credit, aka first time home buyer tax credit is slowly closing. In fact if you didn’t get a signed sales contract by the end of April 2010, the opportunity to take advantage of this program has already ended for you. But, if you were fortunate enough to get a signed sales contract by the end of April 2010, then you have until the end of September 2010 to close on your mortgage.

But, if you are or were in the military or you were or are a federal employee who served outside the continental US for at least 90 days during the period of January 1, 2009 and April 30, 2010 you have until April 30, 2011 to take advantage of the federal home buyer tax credit program. You can get the tax credit no matter whether you get a VA, FHA or conventional mortgage.

To further clarify, if you are eligible for the military home buyer tax credit extension, you must enter into a binding home purchase contract by April 30, 2011 and you have until June 30, 2011 to close on the purchase. If you are a first time home buyer you can get up to $8,000 in the federal tax credit and if you are a “long time” first time home buyer buying a new primary residence you can get up to $6,500 in the federal tax credit.

Depending on where you live and in what state, you will likely find additional state and local municipality tax credits, tax deductions, down payment assistance, and first time home buyer programs. Many of these programs can be used in conjunction with each other which can really add up to your benefit as a home buyer.

My suggestion is to talk your loan officer and your real estate agent to see what kind of programs are in your area and then go for it.

How does BAH work?

BAH provides service members on permanent duty within the U.S. with suitable housing compensation when government quarters are not available, according to the DoD. The reimbursed amount is based on housing costs in the local area in which the service member lives. People on active duty overseas are eligible for Overseas Housing Allowance, or OHA.

The stipend awarded is also determined when looking at the military member’s duty location, pay grade and dependency status. Although the current BAH system allows for many service members to live without any out-of-pocket expenses, some costs may have to be covered. It depends on the housing market.  Either way, a veteran and his or her family can save funds.

Sometimes BAH rates are subject to decrease.  However, individual rate protection prevents the decrease of a BAH rate as long as the duty status of a service member remains the same. And when the new 2010 BAH rates go into effect, this protection assures that the service members’ out-of-pocket costs may be less but not more.

BAH Rates

As stated before, BAH rates an increase and decrease, but individuals are protected from losing allowances.  People with dependents can get about $316 more than single persons.  Persons without dependents receive what’s called Partial BAH.  There’s also BAH II and BAH Diff for persons paying child support.

Buying a Home with BAH

The VA mortgage plan is a program that makes it possible for veterans to buy their dream home.  The U.S. Department of Veteran Affairs secures the VA loan.  With the BAH program, a veteran could use his or her allowances to pay monthly mortgage which with the VA program is less stressful than conventional loan mortgages.  One of the biggest features of the VA plan is no down payment.  So, veterans and their families do not have to come up with a large lump sum of money towards the purchase of their home. Talk with a VA loan specialist today and see how BAH funds could help you to purchase a home!

I’ll start with a simple but powerful statement – if you cannot prove it you probably shouldn’t mention it. Better said, if you can’t give any documentation for what you are making it is likely the VA won’t consider it. So this means that if you get paid under the table for doing some side plumbing or electrical work for a local contractor for example that unless you claim it on your taxes you won’t be able to use it to qualify for a mortgage.

For the most part, the VA wants to see 2 years of employment verified – that is – the last two years. You can accomplish this in a variety of ways – W2′s, tax returns, and or a verification of employment provided by your employer(s). You don’t have to had worked for the same employer for the past two years, you just ought to be able to prove your employment.

You will also, in some cases, be asked to provide your most recent pay stub to show at least a 30 day pay period (this could mean that you need to show your last two pay stubs) with year to date totals. You need to be careful here if you are planning on switching jobs while you are applying for a VA mortgage. If you change jobs during the process you may have to wait to close your loan until you have at least 30 days of pay under your belt from your new place.

Make sure you talk to your loan officer about any job change plans so you can avoid any late minute surprises. The worst calls I can get as a loan officer is at the 11th hour when the lender does their last minute employment verification and the outgoing employer states that the applicant no longer works with the company.

I have heard some bad rumors out there about getting a veteran mortgage loan and being self employed. I am here to dispel any rumors. Yes you can get a VA mortgage if you are self employed – provided you meet certain guidelines.

I’m not going to go into this can of worms in this post. If you want more information on this, Google it, and you’ll find all sorts of clarifying information.

If you are wondering just what you will need to provide to document your income and prove your employment, your loan officer will guide your way. For sure, when you are shopping around for a mortgage in the beginning, you will want to have on hand your latest 30 days worth of pay stubs, and at least your last 2 years of W2′s.

The tail end of the year 2007 introduced to most of us one of the toughest economic times in history.  Due to the financial market meltdown, unregulated mortgage practices, and a handful of other issues, our once robust and stable free market found itself in disarray.  Four years into your personal finances became tight or perhaps your income you were able to quickly access instant equity from your home.

Many American homeowners, including veterans and VA homeowners were using their homes like they were ATM machines.

Using your home as an ATM or quickly accessing cash or equity from your house is no longer possible for the majority of US homeowners.  After the market collapse of 2007 in 2008 home prices have fallen dramatically and many homeowners find themselves unable to make ends meet.  Prior to the market collapse mortgage companies and lenders across the nation were knocking down the doors to find anyone interested in cashing out their home equity to pay off their bills or to even just get a big chunk of change in the bank didn’t care what you would do with it.

I don’t mean to sound like a downer, but the truth is it is going to be years until most homeowners are able to use their home or a mortgage as a way to find short term financial assistance.  There is one very big exception to this prior statement.  If you have served in the United States military or Armed Forces or are currently serving you may be eligible for one of the best loan options available today — the VA loan.

In 1944 the VA home loan program was conceived as part of the servicemen’s readjustment act.  Since this time the Department of Veterans Affairs along with some of the Nation’s leading banks and mortgage companies has been assisting eligible veterans and active-duty military not only reach the American dream of homeownership, but also access the value of their home through easy-to-qualify-for and unique loan programs.

If you currently have a VA home loan on your property and you feel like you are having tough times making ends meet than the VA streamline refinance is the answer to your problem.  Perhaps now more than ever, more and more veterans are looking towards the VA streamline refinance as their way out of financial hardship.

The VA streamline refinance allows eligible veterans to instantly lower their interest rate in their monthly mortgage payment.  There is not a single loan in the marketplace, including an FHA loan that allows the homeowner to refinance without an appraisal.  In addition to lowering your interest rate and your monthly mortgage payment the VA streamline refinance is a great way to receive temporary Greenleaf from your monthly mortgage payments completely.  It is possible through a VA streamline refinance to receive a reprieve for up to two months on your monthly mortgage payment.  Another way in which veterans can gain temporary financial relief is by getting a cash refund of their current escrow.

The following is an example of how someone with roughly a $200,000 mortgage could benefit from a VA streamline refinance.  The following example is an assumption, but these same figures will hold true for most people trying to streamline their VA loan.

• Someone who has a $200,000 VA mortgage with an interest rate of 6.5% would be paying roughly $1500 a month for their mortgage payment.
• Through a VA streamline refinance this VA homeowner could refinance with a streamline to a new rate of 3.75% and save $340 a month.
• As mentioned this veteran would not need to make to mortgage payments and the amount of $1500 per payment which puts another $3000 in his or her pocket today.
• Assuming there is roughly a $1400-$1500 escrow balance this the same veteran could see as much as another $1400 or $1500 in the form of an escrow refund check.
• In summary that is roughly $4500 in immediate financial relief in addition to $4080 a year in mortgage payment savings.

If you’ve been sitting on the fence trying to determine whether or not a streamline refinance is right for you please make a decision today in contact and approved VA lender in your area so that you can receive a much-needed and well- deserved financial relief.  Those that have served this country in the military receive special benefits that civilians are not able to receive.

If there’s any group of US citizens that deserve a quick and easy refinance like the streamline it is America’s bravest, our veterans and active duty military.

Which isn’t true.

VA hasn’t changed their credit requirements on the VA streamline refinance program.

But…

What is true is that many lenders have started requiring that Veterans wanting to participate in the VA streamline loan program now have a minimum credit score.

So, in plain English: While VA hasn’t changed their requirements, many lenders have and are now requiring a minimum credit score for all VA streamline refinances.

What This Change Means For Veterans

When a lender changes their guidelines and starts requiring a minimum credit score, it doesn’t mean that you can’t do a VA streamline loan, it means that if a lender tells you “no”, you just need to shop around for another lender. Becasue each lender makes independent risk decisions when setting risk policy for their company, some lenders will require say a 580 credit score while others will require a 620.

Each one is different.

So if you find yourself in the situation where you cannot qualify at one lender for the VA streamline refinance due to a poor credit score – be sure to ask around.

You might be surprised to learn that people are still doing VA streamline refinances with no minimum credit score.

In the last few months, only a select few lenders have not required a minimum of a 620 credit score on all California FHA streamline refinances. Yesterday, the last major lender who used to not require a minimum credit score has announced that they now require a 620 credit score for all California FHA streamline refinance loans. Taylor, Bean and Whittaker announced that they would now be requiring at least a 620 minimum credit score on all California FHA streamline mortgage refinance loans.

New Minimum Credit Score Announcement Details

FHA Streamlines (credit and non-credit qualifying) and VA IRRRL’s with Credit Scores below 620 must be LOCKED prior to July 13, 2009 AND must CLOSE (Note Date) no later than September 15, 2009, and must be delivered to TBW within 10 days after closing Loans in this category locked on and after July 13, 2009 will require a minimum FICO of 620. Clients will be required to obtain a 3 Repository credit report and utilize the standard method of determining qualifying FICO.

Any Conventional, FHA (including Streamline Refinance), or VA (including IRRRL) loan that exceeds $417,000 with a Credit Scores below 660 must be LOCKED prior to July 13, 2009 AND must CLOSE (Note Date) no later than September 15, 2009, and must be delivered to TBW within 10 days after closing Loans in this category locked on and after July 13, 2009 will require a minimum FICO of 660. Clients will be required to obtain a 3 Repository credit report and utilize the standard method of determining qualifying FICO.

In addition, any previously announced minimum Credit Score requirements that TB&W has put into place, that did not have a specified Closing date, will be required to be LOCKED prior to July 13, 2009 AND must CLOSE (Note Date) no later than September 15, 2009, and must be delivered within 10 days after closing. Therefore, any loan, regardless of whether it may be locked, registered or approved, that has a qualifying credit score below 620 (with the exception of those loans that have specified higher FICO requirements) must CLOSE (Note Date) no later than September 15, 2009.

TB&W will continue to allow non-traditional credit for those borrowers with no useable credit for the loan programs that allow the use of such credit in accordance with published guidelines. TB&W is fully aware that these limitations may result in the inability for a particular loan to meet these specified deadlines. TB&W will work as diligently as possible to accommodate all loans in the pipeline. We will be unable to grant any extensions or exceptions to these requirements.

California FHA Streamline Refinance: What Does This Mean?

Although the FHA guidelines do not officially require a minimum credit score, virtually all lenders (and all of the major lenders) in the US are now requiring a minimum of a 620 credit score. TB&W was the last major US lender who was not requiring that you had at least a 620 minimum credit score. It is possible that there are still smaller lenders who can offer the California FHA refinance streamline loan with no minimum credit score requirement, but it might be difficult to find them.

Recently, some lenders started requiring an appraisal for a VA streamline, something that is completely new to the VA streamline program. It used to be that one of the benefits of the VA streamline program was that you didn’t need an appraisal.

That is still the case with some lenders — some are still not requiring an appraisal — but some are.

To further confuse people, some lenders are now requiring a full blown appraisal, some are only requiring a drive-by appraisal — but the point is that many are now requiring it where before they did not.

As an example, an announcement by Wells Fargo to all correspondent lenders said:

“in an effort to mitigate the risk of declining home values on VA IRRRL transactions on May 18th will require the seller to obtain and deliver a conventional appraisal to Wells Fargo. Please Note: VA has indicated this appraisal should not be submitted to the VA with the guaranty package.”

Does this really make any sense?

I don’t know for sure — but I do know that you shouldn’t be surprised if your loan officer tells you that you now need an appraisal on a VA streamline… and you might want to try to find another loan officer who has access to a lender that doesn’t require an appraisal on a VA streamline.

If you are in the market for a VA streamline and your loan officer is telling you that an appraisal is now required, be sure to ask him if he has access to any other VA lenders – many lenders are still not requiring VA streamlines to have an appraisal.

The VA streamline is also referred to as the VA Interest Rate Reduction Refinance Loan or VA IRRRL for short (and you know how Veterans have an acronym for everything ).

The VA streamline program requires very minimal documentation, and can help veterans start saving money on their monthly mortgage very quickly. Because the California VA streamline program is also known as a “streamline” loan, you cannot receive any cash back at closing.

California VA Streamline Refinance Program Highlights Include:

• No appraisal required
• Must be current on the existing VA loan
• Can’t have more than one 30-day late payment in the last 12 months
• No minimum credit score required***
• You are able to roll all closing costs and prepaid items into the loan amount
• Cant get cash back at closing
• Streamlined documentation requirements mean there is no need to provide bank statements, job verification, pay stubs or W2’s

***Note: Many lenders have begun requiring a minimum of a 620 mid credit score. Many, but not all. We are still able to fund VA streamlines without a credit check, so your credit score does not matter.

Because California mortgage rates have dropped, now is a great time to take advantage of the VA streamline program.  If you have been in your loan even just a few months, you may be surprised at how much you can save with the VA streamline program and in today’s economy every little bit helps!