How Does a VA Home Loan Affect the Seller?
As a veteran or current military member, you’re entitled to certain benefits as a result of your service. A VA home loan is one of them. These loans let you buy a house without using a down payment and typically offer lower interest rates and better terms than traditional mortgages. However, if you’re planning on using a VA home loan in Colorado Springs to buy your dream home, you need to know how it will impact the seller.
Sellers Must Pay Certain Fees
When you buy a house, there are always going to be fees you have to pay at closing. When you use a traditional mortgage, you’re responsible for all buyer-related fees. The same isn’t true when you use a VA loan.
The loan program prohibits buyers from paying certain fees at closing. Typically, this will include the loan underwriting fee and the closing fee. Those fees don’t go away. Instead, they become the seller’s responsibility.
What This Means
Using a VA loan means you’ll end up saving money both on the purchase and over the life of the loan. However, it does mean the person selling you the house will have to spend more to sell you the house. If you’re worried about the seller denying your offer because you’re using a VA loan, don’t be. You just need to be ready to negotiate a little bit.
Sellers want to get as much for their homes as they can. If they know they’ll be responsible for fees that they wouldn’t be if they sold to a buyer using a traditional mortgage, they’ll want to negotiate with you. This means they may counter your offer to help offset the fees they’ll pay at closing. Negotiations are a part of the home buying process, whether you’re a veteran or not.
If you prepare yourself for those negotiations ahead of time, you’ll be better able to make an offer. Don’t be surprised if they stick to their original asking price. If you’re not comfortable paying that full price, you’re free to walk away and continue the house hunt without penalty.
Get Pre-Approved Today
If you’re thinking of using a VA home loan in Colorado Springs, don’t start looking at homes until you’re pre-approved for the loan. This way, you’ll have a realistic idea of your budget and can submit an offer as soon as you find a home you love. Apply online and get prequalified today.