Search for VA Foreclosure Listings & VA Home Loans

The Essentials of VA Foreclosure Paperwork

Just as with any major financial transaction, a certain amount of VA foreclosure paperwork is necessary in order to purchase these inexpensive homes.

Now that you're ready to purchase your VA foreclosure, all you need to do is to sign on the dotted line, right? If only it were that easy. As with any home investment, you will need to fill out a myriad of papers and forms, all helping to get the property signed over to you and to your lender. The VA foreclosure paperwork might seem to be tedious, but it will help you finally have the home of your dreams at a price you can afford.

The First Step to VA Foreclosure

Just as with any foreclosure procedure, once you default on your mortgage, the lender will attempt to contact you. This is generally with a letter after the payment is 30 days past due. At this point, you will be given paperwork to work out the loan terms or you might be asked to simply make the payment as promised. A mortgage at this point is in default and can stay in default for up to 180 days, depending on the terms of the mortgage as written by the lender.

The Second Step to VA Foreclosure

Once the payment is past due for 180 days, then the lender will contact the Veteran's Administration to call upon a clause which is called the acceleration clause. What this does is tell the homeowner that they must make the initial missed payment as well as any missed payments immediately. But if this is not done, then the lender will begin the process of putting the home into foreclosure.

The Final Steps of VA Foreclosure

If the home is put into foreclosure, then an appraiser in the state will perform an appraisal of the property, submitting VA foreclosure paperwork in the process. What this appraiser is doing is trying to determine the price at which the home will be placed on the market for sale. The homeowner at this point has 21 days to redeem the loan by making up any past due payments prior to the foreclosure. If not, then the house will be posted at the courthouse and sold to the highest bidder at an auction.

The actual paperwork can be completed by a Loan Service Representative, a lawyer who is familiar with foreclosure laws, the lender, as well as the homeowner themselves. The paperwork required varies from state to state, but also from lender to lender.

You can apply for foreclosure by calling up a Loan Service Representative at the Veteran's Administration - 1-877-827-3702. They will inform you of the timeline for the paperwork as well as to whom the paperwork can be sent.

Shopping Around for VA Homes for Sale

When you're looking at VA homes for sale, it's better to go into the process prepared than to start your search unprepared for what you're going to find.

VA homes for sale are a common sight in realtor listings these days. Not only are more people falling into foreclosure, but the economy's worsening figures aren't making people compelled to buy a new home. However, if you haven't already looked into VA homes for sale, you might be surprised at what you'll find. Not only are these homes cheaper, but they are also offering lower down payments even for those with less than stellar credit scores.

What You Need to Look For

Just as with shopping for any home, you want to look at VA homes for sale carefully. It all begins by contacting a real estate broker or agent who is already qualified to handle these sorts of transactions. Not only will they be able to navigate the bureaucracy, but they will also be able to help you find the local VA homes for sale in your area. Just as with any home, it can help to be skeptical when you are looking around at these homes. Take the time to have an inspection before you place an offer on the home, as these homes are sold 'as is' and the VA is not going to help out with any repairs. A thorough inspection will help you determine what kinds of repairs may be needed - including cosmetic and major repairs. Knowing this, you can make a lower offer on the house or you just might choose to buy a home knowing that you will have to make repairs in the future.

Your Legal Rights and VA Homes for Sale

Because these homes are being sold by the government, you have a number of rights as the buyer.

The seller pays the closing costs.

The seller has to pay for the termite report
Lenders handle the loans, not the VA.
Veterans have more rights - don't have to be a first time home buyer, inhabit the house, prequalify, etc.
No private mortgage insurance necessary.
Prepayment of loan without penalty.
Loans can be assumable.
VA charges up front funding fee.

What You Need to Avoid: Surprises

While the homes are appraised by the VA ahead of time to determine the value, this appraisal may have shifted since the home was put on the market. In today's ever changing times, it's no surprise that some homes are worth less as they sit on the market. It might be worth it to get your own appraisal before you make an offer to see what the current market value of the home really is. Expect to pay between $300 and $500 for a detailed home appraisal - expensive, but it can pay off when you end up paying thousands of dollars less for a home than its listing price.

You might also want to avoid buying a home which has extensive damage or necessary repair work as you will be completely responsible for this work. This will add to the costs of the home in the long run, though repairs might increase the value of the home over time.