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I refied at 2% so if I ever sell, I’d love to pass that on to another veteran
2.25% here. Same!
Yes. 3. And a few refinances.
ETA
Aw crap I read too quickly. No I've never assumed a VA loan.
But to answer the next question, because I have read up on it a few times, it just depends on the loan. It's a very under the radar feature, that is still possible if the loan terms allow it.
See my edit above
But yes that's the point of assuming the loan, to retain the rate.
I sold mine as an assumption to another veteran. They assumed my rate, then paid cash for the difference. The process took about 3 months, so they 'rented' from us in the interim.
Super rare. Do it if you can - VA needs to sign off on it, and so long as your credit is good you should be sitting pretty on some low interest debt
I haven't personally but Iknow several people who have, do you have questions? I might be able to help you out with some answers.
It sounds like it requires additional time and coordination, I'm curious if there's an approach for finding these sellers
I'm not sure how the VA loan assumption goes, but when you take over another's non-VA mortgage, you have to pay the sellers the amount of money they have already paid towards the loan. So, if it was originally a $300,000 mortgage and they've paid 190,000 towards the loan, then that's what you pay them when you take over the mortgage with the terms that are set for that mortgage.
This is the information I got from a simple AI query:
A veteran can assume a VA loan on a house by going through the VA loan assumption process, which allows them to take over the existing mortgage terms from the current borrower. Here’s how it works:
Eligibility for VA Loan Assumption
1. Veteran or Non-Veteran: While veterans and active-duty service members are typically eligible, non-veterans may also assume a VA loan if approved by the lender and VA.
2. Credit and Financial Review: The assuming borrower must meet the lender’s credit and income requirements.
3. VA Approval: The VA must approve the assumption unless the loan was originated before March 1, 1988 (in which case it may be freely assumable).
Steps to Assume a VA Loan
1. Contact the Servicer: The current homeowner or assuming borrower contacts the mortgage lender (loan servicer) to initiate the assumption process.
2. Apply for Assumption: The assuming borrower submits an application, financial documents, and a credit check to the lender.
3. Obtain VA Approval: If required, the VA will review the assumption request.
4. Sign Assumption Agreement: If approved, legal documents are signed to transfer responsibility for the loan.
5. Pay the Funding Fee: A VA loan assumption requires a 0.5% funding fee (based on the loan balance) unless the assuming borrower is exempt (e.g., a veteran with a service-connected disability).
6. Release of Liability: If the seller is also a veteran, they should ensure the lender releases their VA entitlement so they can use their VA benefits for a future home loan.
Benefits of Assuming a VA Loan
Lower Interest Rate: If the existing VA loan has a lower rate than current market rates, the assuming borrower benefits.
Lower Costs: Assumption fees are typically lower than new loan origination fees.
No Need for New Appraisal: In most cases, assuming a loan avoids the need for a new home appraisal.