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• The veteran selects a home they are interested in. The purchase and sales agreement should contain a VA option clause. Sample wording for a VA option clause:
"It is expressly agreed that, notwithstanding any other provisions of this contract, the purchaser shall not incur any penalty by forfeiture of earnest money or otherwise of be obligated to complete the purchase of the property described herein, if the contract purchase price or cost exceeds the reasonable value of the property established by the Department of Veterans Affairs. The purchaser shall, however, have the privilege and option of proceeding with the consummation of this contract without regard to the amount of the reasonable value established by the Department of Veterans Affairs."

• The contract must also allow the veteran to "escape" from the contract without penalty if he/she is unable to obtain a VA loan. Some veterans prefer to contact a lender to get "pre-qualified" (see how much they can afford) prior to searching for a home. Veterans may also apply for a certificate of eligibility prior to looking for a home or contacting a lender. Please review our site for information on certificates of eligibility.

• Our mortgage partners will help you obtain your eligibility certificate. They will then complete a loan application and gather supporting documentation, i.e., pay stubs and bank statements.

• They will then analyze all credit and income information. Upon approval thru VA an appraisal wil be ordered. VA's appraisal is not a home inspection or a guaranty of value. It is an estimate of the market value as of the date the inspection is made comparing it to similar homes that have recently sold in that area. Although the appraiser does look for obviously needed repairs, VA does request that appraisers not address cosmetic items. VA does not warrant the condition of existing homes. The appraiser is a licensed individual who does not work for VA but is chosen by VA to assure his/her review is unbiased in any way.

• Upon receipt of the appraisal and all supporting documentation on credit, income and assets, the loan will go into final underwriting. After the underwriter reviews the data collected and decides if the loan should be granted, developed for additional data or if the veteran does not qualify and must be denied. Although VA does "underwrite" some loans, it is very rare. The decision on whether or not to approve the loan is generally made by the Underwriter.

• The final step for loans that meet VA regulations and guidelines is the loan "closing" (when the transfer actually takes place). The closing will take place at the designated Title Company or attorney who will conduct the closing. The title company, attorney or lender representative who will handle the closing will coordinate the date and time. Please feel free to call us at any step of the way, we have representatives standing by to answer your questions 1-800-516-5524.

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