Use Your VA Benefits!

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2011

       We just commemorated our service men and women on Veterans Day. Unless you are a Vet, it’s hard to understand the commitment that military service requires. There are over 25 million Vets in this country.  Thanks to President Franklin Roosevelt (in 1944), Vet’s can get assistance in buying homes as a reward for their service to all of us.  Known as the GI Bill of Rights, the VA Loan became law in 1944 and gives Vets who served on active duty and have a discharge other than dishonorable after a minimum of 90 days of service during wartime or a minimum of 181 continuous during peacetime. There is a two year requirement if the Vet enlisted and began service after Sept. 7th, 1980 or was an officer and began service after Oct. 16th, 1981. There is also a six year requirement for National guards and reservists.

          The G.I. Bill offers education and housing benefits to Vets. The big deal for potential buyers is that Vet’s don’t have to put a single dime down as a down payment in order to purchase a property, whereas the minimum down these days for a non-Vet buyer for an FHA loan is 3.5%.  A VA loan pretty much has the same requirements of all loans: 1) you still have to have a job and good job history; 2) you have to have decent credit; and 3) you have to live in the property. VA loans are made by any licensed bank, credit union or loan/mortgage company.

          It’s really important for any Vet to work with a good lender when applying for a VA loan, as there is another layer of paperwork to the mortgage process-proving your military service and getting the right forms out of the Veterans Administration. A savvy lender will help you track down your discharge paperwork (DD-214 form) if it’s been lost through the Veterans Administration.  I have always found the Veterans Administration willing to go overboard to help get a Vet into a home and expedite any paperwork needed.

          A VA loan can be used to buy a house, a townhome, or a condo, or a farm if there is a residence on the land. You can use the loan to build a home from scratch, buy an existing home and improve it simultaneously, or buy a manufactured home and/or lot (the manufactured home must come with the lot, which is rare in some parts of Utah). The Vet can buy property with a married spouse or with another person they aren’t married to, however there are rules about that: 1) the Vet can buy/co-sign with another Vet; 2) the Vet can buy/co-sign with a non-Vet, but there’s a formula used to figure out how much of the Vet’s benefits can be used in the total transaction.

          My lender friends tell me that most of the VA loans granted in Utah are used in the Ogden/Tooele areas-close to military operations. I’m always surprised at how many Vet’s don’t understand their benefits in how to buy a home, who think they don’t qualify to use benefits or think they have used their benefits up in a previous purchase.  Again, get to a good lender and see how you can buy with no money down.  And, thank you from all of us for your service to this country.

Who Slept In Your Bed?

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2011

I’m just about to put a home across the MLS that is rather historic…it is the birthplace of Gordon B. Hinkley, the 15th president of the Church of Jesus Christ of Latter-day Saints.  There’s not a bronze plaque outside the front door noting the significance of the property, but there could be if the owners wanted to get one to display there.  Would President Hinkley recognize the place if he were still alive?  In this example of a historic property, yes, the President would easily recognize his childhood manse as the house is virtually intact on the outside with a wonderfully restored and upgraded interior inside.

If you own a historic home that may be in need of a makover and would like to find money to rehabilitate it, your ship has come in!  Thanks to the lowest interest rates in history, home owners can get loans from the Utah Heritage Foundation for restoration, rehabilitation and repair at half of the current U.S. Prime Rate.  You have to have good credit and income to apply and receive the money from the UHF and there are a few rules as to what the money can be used for:

First priority for funding is placed on exterior improvements, including: brick, chimneys, doors, foundations, masonry, porches, reconstructing existing additions, roofs, seismic retrofitting, siding repair, and windows.  Second priority for funding is placed on interior systems, including: code compliance, electrical systems, heating, insulation, and plumbing. Third priority for funding is placed on interior finishes. For example, UHF will not fund a kitchen remodel if the roof needs to be repaired. However, a kitchen and/or bathroom remodel can be funded if they are incorporated into a more comprehensive rehabilitation project.

How do you know if your property is historic?  The UHF can help by having one of their staff come visit your home. The basic criteria would be:  1) is it listed on the National Register of Historic Places? 2) Is it listed on a local register of historic or cultural resources? And 3) Is it eligible to be a contributing building within a local or national historic district?  To quote them, “In general terms, to be eligible, a building must be at least 50 years old AND retain its architectural integrity.”

The loan cannot be used for concrete pads (parking/patio), fences, incompatible materials (like vinyl windows in a Victorian house), landscaping, new construction (tearing down a home or building one on a vacant lot), refinancing mortgages and putting up retaining walls.  Then again, what you want and need is decided on a case by case basis by the staff.  The terms of the loan are good because of the low interest rates and offer low monthly payments based on a 20-year amortization schedule, but the payment term for the loan is 5 years with a balloon payment of the remaining principal and interest due at the end of the fifth year.

The Utah Heritage Foundation has been around since the 1960’s grants loans all over Utah and is helping to protect our history and architectural past. You can follow them and their projects on facebook at https://www.facebook.com/preservationutah/  or go to their site at www.utahheritagefoundation.com and learn more about what they do for all of us Utahns. There’s also a great kids game on their home page – a hunt for the secret silver coins of the Kearns Mansion.