Real Estate Purchase and Sale Agreements
When you work with a licensed real estate professional in Idaho, you will typically write an offer using a standard contract form called the “RE-21 Real Estate Purchase and Sale Agreements” which is distributed by the Idaho Association of Realtors®. This standardized form allows you to negotiate many terms of the purchase including:
- Purchase Price
- Loan Amount
- Earnest Money
- Financing Type
- Items Included/Excluded
- Inspection Contingency Clause
- Appraisal Contingency Clause
- Seller & Buyer Paid Closing Costs
- Dispute resolution
- Closing Date
- Closing Escrow Company
- Title Company
- And Much More!
Additional forms may be included in your contract including counter-offers, addendums and contingency release forms.
Non-Allowable Closing Costs
Lenders must strictly adhere to the limitations on what can be charged to the Veteran when making a VA loan. This means that the Veteran is not allowed to pay all fees that are often charged by mortgage companies. These fees are called “non-allowable” closing costs. In many cases that means the Veteran must negotiate with a seller to cover these additional loan costs.
The Benchmark Mortgage Closing Cost Advantage
At Benchmark Mortage we have options that will allow the veteran to make competitive offers that don’t require the seller to pay extra costs. This means the Veteran buyer isn’t at a competitive disadvantage compared to other buyers when negotiating seller paid closing costs which reduce the seller’s proceeds.
Other Closing Costs
While Benchmark does not have any closing costs that have to be paid by the seller, it is at your discretion whether you choose to negotiate to have the seller pay standard closing costs so that you can reduce your cash-out-of-pocket. The VA will allow the seller to pay up to 4% toward the buyers closing costs (rarely would you need this much) and another 4% toward the buyer’s qualifying debt. This scenario can help the veteran qualify for a higher purchase price.
Appraisals & Inspections
Many sellers and Realtors® have misconceptions that the VA is overly picky in regards to property condition. While the VA used to be much stricter about the properties they would finance, changes in the last few years have made the VA requirements very similar to the requirements on FHA and Conventional loans. The VA’s obligation is still to protect the veteran to ensure they are purchasing a quality home. Click here to read some of the other myths about VA home loans.
Rapid Closing Advantage
A recent survey from a Ellie Mae shows that most lenders take approximately 50 days from contract until loan closing. At Benchmark, we are approved to directly underwrite our VA loans. Thus, your loan can be processed and closed by us without waiting for VA’s approval of your credit application, which means a VA loan typically closes in less than 30 days. For a seller who is eager to close quickly, this may give you another negotiation advantage.
To apply for a Zero Down VA Home Loan and find out more about whether you qualify call one of our VA Home Loan Specialists at (208) 287-1705 or get started online.
