Hi All, Hubby and I have our eye on a place. 2 bedroom cabin on a REAL secluded 90 acres off the grid. We have a VA loan available but someone told him the VA would not loan us money for a place like that. Has to be on a maintained road ect. Any one know for sure? Thanks. P.L.
VA loans can get very picky. It's been a few years but I doubt that your dream place will qualify for one.
What VA and FHA will require, is that say the house is on a septic, but sewer is in the street. To get the loan, you (I think VA requires the seller to pick up this cost) WILL have to hook up. Stuff like that. Now many places, once they put in the sewer to the street will charge the property owner whether they're hooked up or not (as an incentive, don't you know....) but there are people who will still stall on hooking up because of how much it costs to run the pipe to the house, etc. VA has fairly rigorous inspection standards, too, all to protect the buyer. I don't know how quick they are about getting inspectors out, etc. A lot of sellers won't go VA or FHA because they have to pick up a certain portion of the costs, and because they have long escrows. If you were a seller, do you want to wait 45-60 days to close on a VA loan when you could get a buyer who can close in a week to ten days with a conventional loan? Two mortgage payments are two mortgage payments.
Thanks guys, Well, this place is pretty much "out there" requiring 4WD in bad weather. The sewer system a few miles away. And that's fine by us! We do have enough put by for a down payment but it would have been nice to be able to save that for other things. I saw on the site you gave me Bob that they will give loans for converting to solar or wind power. That's something we would like to do later. My husband is overseas right now so we haven't been able to go and look at the place "in person". From what I see on the photos and the satelite pictures both solar and wind power look feasable. ( it's high on the side of a ridge with lots of south west exposure.) Maybe we could use the loan for that. I've been unable to log on to the VA website so far today. Just keeping our fingers crossed that it will still be for sale when Ken gets home in August! Thanks again, P.L.
In reference to the amount of time necessary for a VA loan to be completed: We had a wretched experience with that! In fact, have still not closed on our house because of the VA -- luckily, the seller is perfectly happy to do a good deed for a couple with a new baby and let us rent to own. First, the VA inspector never made an appointment. She called when she was fifteen minutes away. Considering how far out we are, she had been driving for quite some time before deigning to call. Luckily, my husband was home that day since I was on bed rest for pre-term labour. He did the fifteen minute "House Rescue" and everything was fine when she pulled up. Second, she took absolutely no pictures of the interior of the house. Because of her neglecting to document the improvements on the inside, the house appraised for less than the asking price. Strike one for us getting it. Even when my husband and I both asked her to make certain to note the brand new carpets, appliances, wood stove, custom tile work, etc., she brushed it off as not important! Third, she took one picture of the outside. When asked why she wasn't taking any pictures, she replied, "They aren't important in this." So, here we are, two years later, struggling to try to get a new inspection, a change in the appraisal, etc. I'm heartily sick of the VA and their reluctance to come out here and really look at the house and the land. If we could, we'd be going to a bank for a conventional mortage and heck with the VA! So, my advice, check other ways of financing before going to the VA. I'm sure a lot of folks ahve good luck with them, but we didn't. Just a cautionary tale.
First, when we built our place in Wisconsin, we found out that the VA will only back the financing for a homeon up to 20 acres max. They consider anything more than that a commercial enterprise (i.e. a farm). So we went with a conventional loan. Also, that would have been our third use of a VA backed home loan and that means a 3% funding fee instead of just the 2% funding fee that you pay the first two times you use the VA. To me this means that the VA profits off military families who have to move frequently yet still want to own their own home. They couldn't or wouldn't explain to me the logic behind this 1% "penalty". Finally, the VA wants everything about the property to be perfect and would never back 90 acres and a log cabin without modern utilities down a 4wd lane. They just wouldn't do it. Someone up this thread said the VA is so picky because they want to protect the buyer. That's only partially true. The real reason is to protect the VA if the buyer defaults. They will only back a property that is readily and quickly resaleable in case it comes back to them.
I see VA loans as lenders of last resort. I have been told that if you have decent credit, do not bother with VA or FHA loans. I can see the VA's point about not wanting to finance something that will be difficult to sell should the buyer default--if I were financing a property, I would feel the same way. Unique properties can take months, sometimes years to sell, especially when the seller is unrealisitic about what the market will bear and is stubborn on price.
