Advantages Of VA Vendee Financing To Buy VA Homes For Sale

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There are many advantages of using VA Vendee Financing to buy VA home foreclosures not only for home owners but also for investors.

VA Vendee Financing is financing provided by the Department of Veterans Affair on the purchase of VA homes for sale. Both Veterans and Non-Veterans can apply for a VA Vendee loan. Also, both home buyers and investors can apply. There are many advantages of using VA Vendee Financing to buy a VA repossessed home.

VA Vendee Financing | The Advantages 

1. Easy application process. You don’t have to use a mortgage company. You will fill out credit application VA Form 26-6705b Credit Statement of Prospective Purchaser. You will need verification of your income and employment. VA doesn’t use credit scores as a determining factor.

2. Reduced closing time. Since you are not using a mortgage company the time of acceptance of offer on VA repossessed home and to the day of closing is much faster.

3. Competitive interest rate. The VA home loan interest rate is closed to the current market mortgage rate of mortgage companies for home buyers. This rate would be very attractive for investors since most investment rates are around 1% higher than home buyer rate.

4. Low down payment. The down payment for Owner-Occupant can be 0% down. The down payment for investors can be only 5% down. Again, this is very attractive for investors since most mortgage companies require 10%-20% down.

5. Earnest money deposit. The earnest money deposit is only $500.00. The earnest money deposits on most HUD homes and other bank foreclosures are at least $1,000.

6. Mortgage insurance. Mortgage insurance (PMI) is not required for either the home buyer or investor on the purchase of a VA repossessed home.

7. Closing costs. Closing costs are lower on VA Vendee Financing. There is no tax service fee, appraisal fee, flood certification fee, title insurance, or survey costs.

8. $2,500 origination fee. There is a $2,500 origination fee that includes credit report, flood certificate report, tax service, and closing costs.

9. Seller contribution of 3%. The seller can contribute up to 3% of the sale price of the property to help pay for the buyer's closing costs (including the above mentioned $2,5000 origination fee),prepaids such as home insurance, property taxes etc.

10. No pre-payment penalties. You can pre-pay any amount of the loan that you want to and there are not penalty.

11. Not credit score driven. VA Vendee Financing is not a credit score driven loan product.

12. VA Vendee loans can be assumable.  But,of course, the new buyer would still have to qualify.

13. No maximum number of investment properties. An investor can buy as many investment properties as they want.

The one big disadvantage is a funding fee, currently 2.5% of the VA Vendee loan amount and it cannot be included in the Seller concessions.

As you can see there are a lot of advantages of VA Vendee Financing for VA homes for sale especially for investors.

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