Any of you sold a house to a person with a VA loan?

[TGO David]

I listed my old house to sell this past Thursday.  Since then we've had a bunch of offers but so far the best one is actually above asking price and the customer has a pre-qualified VA loan.

 

I really want a quick and painless sale.  I don't want to spend a lot of money fixing this and that at the old house.  It's in very good shape but I've heard nightmare stories about home inspectors working for the USAA on VA loan sales being super picky about, well... everything.  Almost to a one, the friends I have who bought on VA loans or sold to VA loan customers said that the seller had to do quite a bit of remediation work to satisfy the lender before the sale went through.

 

Is that typical?  Have any of you gone through this?

 

My second-best offer is from an investment company and is a cash offer at asking price.  There would be an inspection but they are only looking for major repair issues like flood/fire damage, structural unsoundness, etc.  Unfortunately the agent soliciting the purchase for that investment company says that she cannot get us anything in writing from the company until Monday.

 

If we wait for them, the VA customer's offer expires tonight.

 

One in hand versus one in the bush?

 

Help me out here.

[Hozzie]

I haven't sold to anyone getting a VA loan, but in general, when the government is involved, it has a much higher probability of going sideways.  I suppose it depends on how much more the offer is and if you think it is worth it.  In my experience (family has a lot of real estate investments), dealing with investment bankers is much easier.  That doesn't guarantee anything either, but I think since it isn't a specific person buying it, unless there is a major issue, you probably won't have any lengthy delays.

 

The VA loan could go perfect.  I would guess it could take 8 weeks longer to close though.

Edited May 2, 2015 by Hozzie

[ArmyBrat61]

Never rush a real estate deal and tread carefully when dealing with FedGov. You have an offer for your asking price from an investor, sounds like they want to flip it at a profit. That's how I bought my house for 1/3 of market value and nothing is wrong with it. The VA has time, money and bargaining power on their side. Quick and painless are not spoken by the govt or their agents....just my :2cents:

[Dolomite_supafly]

Stress free, or at least less stress, is worth a lot. Unless the difference is substantial I would wait on the investment company because it will likely be an easier transaction.

I know that when we were refinancing we could have used the VA system but chose not to because it was easier, cheaper and quicker than dealing with the VA. I could not imagine the BS a seller would have to go through.

[mikegideon]

Based on my limited experience, a brain transplant is a little less tedious than any real estate transaction. 

[DaveTN]

I have never sold a VA, but I have tried (many years ago) to buy on a VA loan. They are pretty picky.

I assume the offer is contingent on a VA inspection sometime after the offer expires?

How can someone getting a VA loan offer more than the asking price? And why would they?

[teecro]

How can someone getting a VA loan offer more than the asking price? And why would they?

 

The VA Buyer more than likely has been told there are other offers on the table and they are trying you lure the seller their direction... As long as the loan is for less than the house appraises for the leader does not "really" care what the asking price or what you pay for it.... From what I've been told from a co-worker is that his VA backed loan was worlds easier than the conventional loan we accquired near the same time. He has a marginal 700 credit score and jumped through no hoops whereas I have an 800+ and needed so much info I all but needed a note from my dead mother....

 

When I listed my house there were offers the same day as listing with the same buyer bumping their offe rseveral times to above asking price when they were told I had other offers. I took a cash offer of 5K less than asking as they offered CASH with no further inspection needed and ASAP closing.... We had cash in hand less than 2 weeks after listing day....

[bersaguy]

I wonder why you would even think about waiting on a VA loan being easier than cash on the table and you walk away unless the cash price means a loss in profit in the sale. Since when does anyone trust anything Federal Government touches................. :shrug: :shrug: ..........jmho

[btq96r]

The VA is going to be stringent for their benefit as much as the buyers.  If the buyer defaults on the mortgage, the VA has to pay the loan, and deal with the re-sale of the house.  They are going to do everything they can to minimize their re-sale costs up front by making you pay for repairs. 

 

Unless the money between the two offers you mention is enough to cover more repairs and still be worth the pain, I'd say go with the non-VA source.  At the end of the day, I'm guessing you're ready to be done dealing with a home you aren't living in or getting a rent check from.

[Raoul]

VA guidelines will mostly mirror FHA requirements. If the house was built before 1978 any peeling paint could be an issue. The attic will need to be insulated to a minimally acceptable level. If there's a crawl space a vapor barrier will be required and possibly minimally acceptable floor insulation for your area.

All Utilities will be required to be functional.

Some type of acceptable heating source (HP, GFA/AC, Radiant in all living areas, etc) is required.

Those are the base requirements.

From the forum I gather that you are pretty particular about things, so my assumption is that you will have little to no problem with the appraisal.

If you have further questions pm me for my personal contact info and I'll be happy to discuss any questions you might have.

[TGO David]

Thanks folks.  After I posted this we had to head out to meet some friends for a birthday dinner.  We also had to give our agent an answer about the pending offers.  We ended up telling her that we were going to wait and give the investment group until Monday to give us their offer.

 

As many have said in this thread now, any time you deal with the government whether it is FHA or VA, there are many more chances for it to go sideways.

 

The investment group offer was full asking price, cash, with a simple inspection to make sure there was never any flood or fire damage or structural problems.  None of those are of any worry to us, so this looks like it will be the easiest AND fastest way out of that old property.

 

Keeping our fingers crossed and praying we made the right decision.  :)

[herr.baer]

I just sold my house in Maryland and it was to a VA loan. It went painlessly. Just need to be patient while the VA does their thing. They will check the house over pretty good and make sure things are up to snuff. They are basically just verifying that the house appraises for what you are asking for because they will be stuck with it if the new home owner defaults on the loan.

[macville]

Thanks folks.  After I posted this we had to head out to meet some friends for a birthday dinner.  We also had to give our agent an answer about the pending offers.  We ended up telling her that we were going to wait and give the investment group until Monday to give us their offer.

 

As many have said in this thread now, any time you deal with the government whether it is FHA or VA, there are many more chances for it to go sideways.

 

The investment group offer was full asking price, cash, with a simple inspection to make sure there was never any flood or fire damage or structural problems.  None of those are of any worry to us, so this looks like it will be the easiest AND fastest way out of that old property.

 

Keeping our fingers crossed and praying we made the right decision.   :)

 

I just sold a house that was a VA Loan. Even though I put in the ad, needs paint jobs and other work, the agent still showed it to the client even though they should have known from the ad that it was not the right house for a VA Loan. A month and half later, and after major headaches with the VA inspector (an independent inspector, not actual gov employee) who doesn't under their regulations we finally got the house sold. If it's an older then 1978, just ignore any offer that is a VA Loan because it's not worth your time and effort to bring it up to the FHA/VA code required (or any house that is a fixer upper.)

[Patton]

To be honest, when I bought my house, my first and only one, the flipper actually acted like he wanted to deal with me over everyone else because it was a VA loan. I don't remember VA even inspecting it and I especially don't remember him having to make any repairs other than the one my private home inspector found.

[gregintenn]

Based on my limited experience, a brain transplant is a little less tedious than any real estate transaction. 

A cash sale makes those problems go away. David went the route I would have taken based on the information he gave.

[TNWNGR]

VA guidelines will mostly mirror FHA requirements. If the house was built before 1978 any peeling paint could be an issue. The attic will need to be insulated to a minimally acceptable level. If there's a crawl space a vapor barrier will be required and possibly minimally acceptable floor insulation for your area.

All Utilities will be required to be functional.

Some type of acceptable heating source (HP, GFA/AC, Radiant in all living areas, etc) is required.

Those are the base requirements.

From the forum I gather that you are pretty particular about things, so my assumption is that you will have little to no problem with the appraisal.

If you have further questions pm me for my personal contact info and I'll be happy to discuss any questions you might have.

My understanding as well. If the house had any known issues such as paint, fuse box, water heater or electrical outlets then that was going to cut into your profit. It sounds like the decision to take the Investment Groups offer decision you've made won't cost you any unexpected money.

[analog_kidd]

I don't know how much more the VA offer was, but you likely would have had to shell out money to make a lot of silly repairs, so it would have been a wash. And, there would be countless headaches and delays waiting on the VA. The Investors are going to give you your asking price, which is probably more than what you were willing to negotiate down to anyway. To me that would be a win.

[TGO David]

I can tell you this much, right now is a crazy crazy seller's market especially for homes in the sub $200K range in decent school zones and growing towns.  Two guys I know at work have sold homes in the past few months and none of them lasted on the market a week.  One lasted 24 hours.  Mine will technically have lasted four days if we accept an offer from the investment group tomorrow, but they made a verbal offer at 48 hours.

 

Our agent told us there is a serious drought of starter family homes and they are just being snapped up left and right by investment groups.  The only way an individual buyer can compete in this market is to be pre-approved for a loan.  Not pre-qualified, pre-approved.  Investment groups know that a lot of people lost homes a few years ago, have been renting apartments and are tired of that lifestyle, but likely still don't have strong enough credit to buy right now.  That's who these investment groups are buying up to rent to.  And they're renting them faster than they can buy them.

[KKing]

I can tell you this much, right now is a crazy crazy seller's market especially for homes in the sub $200K range in decent school zones and growing towns. Two guys I know at work have sold homes in the past few months and none of them lasted on the market a week. One lasted 24 hours. Mine will technically have lasted four days if we accept an offer from the investment group tomorrow, but they made a verbal offer at 48 hours.

Our agent told us there is a serious drought of starter family homes and they are just being snapped up left and right by investment groups.

Seen this in the last couple weeks here in Columbia with a lady I work with as well. Her home was listed for 7 hours before she accepted an offer on it. She said initially she would be happy getting $159k for the house, it listed at $209k and she got every cent of it.

Coincidentally, now there are several homeowners on that street looking to sell now.

[DWARREN123]

Never sold one but bought one on VA loan. It had to pass the VA inspection and was a new home. The inspector found some small items and they had to be fixed and reinspected before the loan would get approved.

[56FordGuy]

I can tell you this much, right now is a crazy crazy seller's market especially for homes in the sub $200K range in decent school zones and growing towns.  Two guys I know at work have sold homes in the past few months and none of them lasted on the market a week.  One lasted 24 hours.  Mine will technically have lasted four days if we accept an offer from the investment group tomorrow, but they made a verbal offer at 48 hours.

 

Our agent told us there is a serious drought of starter family homes and they are just being snapped up left and right by investment groups.  The only way an individual buyer can compete in this market is to be pre-approved for a loan.  Not pre-qualified, pre-approved.  Investment groups know that a lot of people lost homes a few years ago, have been renting apartments and are tired of that lifestyle, but likely still don't have strong enough credit to buy right now.  That's who these investment groups are buying up to rent to.  And they're renting them faster than they can buy them.

 

That's the case outside of TN as well. The market out here in the $200 and below, even up to 250 is booming.

 

Unfortunately, the market for not-so-starter homes in TN is a little slower than I'd like. In fact, supposed to have a chat with the realtor tomorrow about that very thing. 

[TGO David]

 

Unfortunately, the market for not-so-starter homes in TN is a little slower than I'd like. In fact, supposed to have a chat with the realtor tomorrow about that very thing. 

 

Yeah we've seen a little of that in our new neighborhood.  Granted it's all new construction but it's been slow going for the builder.  Things have recently started to pick up for him, though, and he's sold more lots with homes to build on them in the past three months than I think he did all of last year.

[tnhawk]

My experience with VA was it was difficult for the buyer and seller to satisfy VA.  I decided I would never deal with VA again.

[Sam1]

We bought this house 2 years ago with a VA loan and had no issues with it, but it was also fairly new and was move in ready... The VA inspection showed some things that most would not even blink at, but they had to be remediated before the deal could go through.  I think there was a total of maybe $2,000 tedious things the sellers paid to get fixed that we could've fixed ourselves for a few hundred bucks and not even worried about.

 

Unfortunately the thing about the VA inspections is that they pick from a pool of inspectors in the region and you never know which one is going to do the property, so you can't pick them like you can the appraiser which makes it impossible to know what you should look out for outside of the major items (roof, electrical, plumbing, structure etc).

 

 

edit

I'll dig through the paperwork this afternoon and see if we have a copy of the actual VA inspection report and shoot that over to you so you can see what it looks like.

Edited May 3, 2015 by Sam1

[TGO David]

Yeah, you guys are confirming my desire not to deal with VA loans if I can avoid it.  It's a shame, really.