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VA Loan / Veteran Mortgage News
SPONSOR:
Pioneer Military Loans offers responsible military lending solutions that can help
service members avoid or break the debt cycle. Pioneer serves active-duty and career-retired military service members,
as well as Department of Defense employees.
JANUARY 2003
Your Mortgage Questions Answered
Q. How can I know the amount of cash that will be needed to purchase a home?
A. When you apply for a loan you'll be given a "Good Faith Estimate" form showing your
expected closing costs. We'll go over this estimate with you, and explain what all the
charges are for. You'll also have the chance to review a settlement statement before you close
on your purchase. This is also called a HUD-1 form. There shouldn't be large discrepancies
between the numbers on your Good Faith Estimate and your final settlement sheet.
Reviewing different mortgages before choosing one allows you to gain more control over your
closing costs. For instance, one loan may offer the lowest rate, but will have higher
closing costs than another mortgage. You'll want to pick a loan that suits your
financial needs, and allows you to buy the home you want.
Q. What price appreciation can I expect to see on my home?
A. U.S. house prices on average have increased every year for decades. Typically
they rise slightly more than the rate of inflation. However, this understates the financial
return you're enjoying when buying a house. Since most purchasers invest just a small
portion of their home's price as a down payment, their gain actually is much higher.
Here's how it works: You put $3,000 down to purchase a $100,000 house. Next year the home is
worth $103,000. Although that's an increase of three percent on the property's price, it's equal
to your total housing investment. In other words, in this case your appreciation would be
100 percent on the amount you put down. The main reason you're purchasing a home is to live in it.
But steady increases in house values mean that your home with time will probably represent the
largest single asset you own.
Q. How do I choose a real estate agent to work with?
A. Start by getting referrals from friends or family members. Next, interview several
agents to find one who specializes in the neighborhoods and price range you're considering.
It's important to feel that you can communicate well with an agent before starting the home
buying process. Ask to speak with some of their previous clients, as well.
Also make sure to have us pre-approve you for a loan before you start shopping for homes.
You'll then be able to tell your agent how much you can afford to spend, so you'll be sure
to look only at homes that you can afford. Feel free to contact us whenever you have a
question involving real estate finance. Rely on us to be a resource that you can trust.
Low Rates Continue
Last year homebuyers enjoyed the lowest average mortgage rates in more than 30 years.
So it's no surprise that house sales reached an all-time record in 2002. Households who didn't
make a purchase last year still can enjoy favorable buying conditions today. Rates should
remain attractive through this spring, giving you time to find a house you'll love for years
to come.
Economists don't expect mortgage rates to go up much until economic growth strengthens. Most
experts say that won't occur until the second half of 2003. Buyers also will benefit as home
prices go up at slower rates this year. Low rates and eager sellers make today a great time
to look into purchasing a home.
Let us know if either you, or someone you care about, are ready to buy. We work hard to help
folks turn their housing dreams into reality.
VA Jumbo Loans Get Higher Amount
We gave you an update in our June 2002 issue about VA Jumbo Loans. It stated that veterans who
live in high cost areas or who wish to purchase or refinance a home loan with a price in excess
of $240,000 can now us their VA status to do so. The Veterans Administration currently allows
eligible veterans to obtain a loan up to four times the amount of their eligibility. Since the
maximum eligibility is $60,000, the VA maximum loan can be $240,000. In cases where the new
loan amount exceeds that amount, the VA will now allow the new loan amount to go up to $322,700
(new conventional conforming loan maximum), with the stipulation that the veteran either put
down a 25% down payment on any amount over the $240,000 or have sufficient equity in their
property for that amount.
You Deserve the Best!
Our goal is to make your home purchase or mortgage refinancing go as smoothly as possible.
But we need feedback from you to make sure we're achieving your expectations. We're always eager
to hear your questions, concerns, and suggestions. It's the best way we know to make sure you're
happy with the service that we provide.
Additionally, we count on you to tell your friends and family about what we've helped you to
accomplish. Informing others about our services is the best compliment we can receive from you.
Invest in Your Family
A recent poll shows that more than three out of five parents of high school students believe
it's "absolutely necessary" for their child to earn a college degree. Yet paying for this
education is difficult for many families. Fortunately, owning your home can help meet
college costs.
Often parents pay tuition bills by borrowing against the value built up in their home.
They then can pay back these important expenses over many years. Having your own home also
provides a stable family situation, which helps youngsters to thrive. We can show you how
easy it is to purchase a house now, or to gain the funds you need to educate your children
for a successful future.
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