Roger That 2016

HOW TO BATTLE DISCRIMINATION AGAINST VETERANS AND VA LOANS VA defines QM to mean any loan that is guaranteed, insured, or made by VA. PAGE 21

2015 HOUSE A VET INITIATIVE Read about our recent “House-a-Vet” Initiative Homeowner and where he came from. PAGE 25

2016 NATIONAL EVENTS POLICY CONFERENCE JUNE 5-7, 2016 · WASHINGTON DC LEADERSHIP ACADEMY OCTOBER 16-18, 2016 · LAS VEGAS, NV PAGE 5

2016 VA Disability Compensation Rates PAGE 25

FROM HERO TO HOMEOWNER Last year, Tony Adkins was ranked by an industry trade publication as the 10th-busiest originator of Department of Veterans Affairs (VA) loans. PAGE 16

JANUARY 2016

VAREP NATIONAL NEWS

A Letter From Our President

ROGER THAT JANUARY 2016

Dear VAREP Members, I present you “RT – ROGER THAT – January

EDI TOR I AL

2016” E-Zine Newsletter. This is the best way

PUBLISHER USA Homeownership, Inc. DBA Veterans Association of Real Estate Professionals

for VAREP National to communicate happenings within our organization to our membership.

VAREP experienced tremendous growth and

EDITOR Denise DiSalvo

recognition in 2015 for the important work

CR EATI VE

that we do. Each of you should be proud

GRAPHIC DESIGNER Jesus Lopez

and stand tall knowing that your passion to empower veterans to realize the American Dream of homeownership has enabled VAREP to be recognized by key leaders in the real estate, financial, and government sectors as the authority on, and voice of, military and veteran financial-literacy and homeownership.

VAREP ACCOMPLISHMENTS FOR 2015 •

10 homes donated mortgage-free to deserving heroes across America.

•

500 military and veteran families realized the American Dream of homeownership through our

WEB DEVELOPER Francisco Labias VIDEO PRODUCTION Taylor S. Grezchowiak CON TACT VAR EP HEADQUARTERS 951 · 444 · 7363 info @VAREP. net 462 Corona Mall Suite 102 Corona, CA 92879 w w w . V A R E P. n e t

programs and services.

•

5,000 real estate and lending professional were trained as a result of the 80 live events and online membership training.

•

•

• •

1,500 military and veteran families educated about homeownership, financial literacy, and the

ABOUT SON

VA loan program through the live Veteran Housing Summits events hosted by VAREP local

Son Nguyen is the founder and president of the

chapters across the country.

Veterans Association of Real Estate Professionals

320 military and veteran families were provided food, utilities payment, rent back payment,

(VAREP). Mr. Nguyen creates, implements, and

basic supplies, clothing, and blankets during the 2015 holiday season. This was made possible

overseas the programs within VAREP including

through our VAREP Cares program implemented by the VAREP local chapters.

working with government agencies and policy makers

$40,000 in the form housing assistance grants for down-payment, closing costs, and adaptive

to create and reform veteran housing policy to

needs. This was in partnership with the Asian Real Estate Association of America (AREAA).

remove barriers to homeownership.

$1.4 million spent on home rehabilitation for mortgage-free donations and veteran first resale program.

He is frequently called upon as a subject-matter expert by government agencies, the real estate

HOW TO EXPLAIN WHO WE ARE AND WHAT WE DO I frequently receive phone calls from our membership on how to explain VAREP as an organization.

Depending on your audience, you may want to adapt the points listed below to introduce VAREP.

industry, the lending industry, and real estate trade organizations to consult on a variety of veteran housing issues.

Mr. Nguyen has more than 19 years’ experience

•

•

VAREP is a 501.c.3 nonprofit organization that was founded to directly educate the 1.4-plus

in real estate, public speaking, supplier diversity,

million active military and 22-plus million veterans on sustainable homeownership, financial-

curriculum development, and non-profit management.

literacy education, VA loan awareness, and economic opportunity.

His record demonstrates innovation and leadership at

VAREP is the only organization that educates military and veteran families on the importance

the highest level.

of financial health on the road to homeownership.

•

VAREP is the only organization that educates the real estate practitioner on the important housing-policy and lending initiatives that affect the military and veteran communities.

Mr. Nguyen established VAREP as a housing non-profit for vets, by vets. He believes VAREP’s proactive stance of providing financial-literacy education and advocating homeownership can greatly

VAREP Comparison to Other Veteran Nonprofits

impact homelessness among the veteran community,

The comparison chart to the right shows that we fill a much needed gap in financial-literacy and

by both reducing the current epidemic and preventing

housing components that the other veteran service organizations simply do not offer…In other words: We complement them and do not compete with them.

Our organization has only scratched the surface of creating awareness and having people rethink how to better serve underserved military and veteran housing needs. To a great 2016...Cheers!

future occurrences, one veteran at a time.

Mr. Nguyen entered the Navy in 1996 and served as a Radioman on the USS Vincennes (GC-49) and USS Constellation (CV-64). A proud serviceconnected disabled veteran, Mr. Nguyen holds a bachelor’s degree in Public Relations from of the

Son Nguyen

University of Florida and a Master’s in Organizational

VAREP Founder and President

Management. He currently resides in Corona, CA, with his wife, son, and Labrador.

1

VETERAN NON-PROFIT COMPARISON CHART Target Audience

VAREP Veterans = 22+ Million Active Duty = 1.4+ Million

MILITARY WARRIORS FOUNDATION Wounded Warriors OEF, OIF, ND = 51,849

OPERATION HOMEFRONT Active Duty Family of E1 - E6 = 1.1 Million

WOUNDED WARRIOR PROJECT Wounded Warriors OEF, OIF, ND = 51,849

USA CARES Post 9/11 Servicemembers & Family

Financial Assistance

X

X

Emergency Food

X

X

Emergency Home Repair

X

X

Critical Baby Items

X

X

Home and Appliance Repair

X

Furniture and Household Items

X

Local Moving Assistance

X

Apartment Transitional Housing

X

X

Permanent Housing Placement

X

X

Employment Job Board

X

Rehabilitation with Recreational Therapy

X

X

X

X

Peer-to-Peer Counseling

X

Family Support Retreats

X

Peer Mentoring

X

Information Technology Training Academy

X

Financial Literacy Education

X

X

X

VA Home Loan Program Education

X

Housing Education

X

Housing Counseling

X

Credit and Debt Management Education

X

Credit and Debt Management Counseling

X

Military and Veteran First Look Affordable Housing Purchase Program

X

Mortgage Free Donated Homes for Wounded Warrior and Spouses of Deceased Warriors

X

X

X

Community Outreach

X

X

X

Live Community Housing, Financial Literacy, and Employment Fair Outreach Events

X

REALTOR, Housing Professional, and Lender Military and Veteran Certification Course

X

Military and Veteran Friendly Database

X

Advocay with a Written Policy Plan

X Military and Veteran Housing Lending Policy

Housing and Lending Policy Conference

X

Military and Veteran Financial Literacy, Housing, and Employment Resource Center

X

X

X

X Wounded Warriors

NOTE: The non-profit comparison chart does not list the national minority real estate trade organizations including AREAA, NAHREP, and NAREB because we are not structurally set up as a trade organization. We have our membership whom we educate to better serve the military housing needs, but ultimately we are all here to serve the military and veteran communities.

2

January 2016 TABLE OF C O NTE NTS

About VAREP University

3

National Eventw: The 2016 Policy and Leadership Event

5

CFPB Releases Tool to Help Measure Financial Well-Being

7

2016 VA Disability Compensation Rates

9

For REALTORS®, Lenders, and Housing Professionals Members and Non-members are W elcome.

How To Battle Discrimination Against Veterans And Va Loans

11

From Hero To Homeowner

16

House a Vet Initiative

25

What is VAREP University?

As the voice for veteran real estate, our goal is to arm practitioners with the right tools so they can better serve the active-duty and veteran communities’ housing needs. VAREP University is the centralized learning platform for the Veterans Association of Real Estate Professionals.

Members and non-members can earn designations by creating a VAREP University user account, select from the course library, pay and complete the course with a minimum 70

2016 NATIONAL EVENTS

percent score on the final exam.

FEATURED COURSES The MVHC is designed for a comprehensive understanding of the Department of Veterans Affairs’ (VA) Home Loan Guarantee Program. We want our members to have an industry recognized course needed to effectively serve the housing needs of our military and veteran communities. Our goal is to educate and empower attendees to embrace the VA loan program instead of shying away from it. Can be taken live or Online.

UPCOMING EVENT

Policy Conference JUNE 5- 7, 2016 · WASHINGTON DC

PAGE 5

The SCRA is designed for a comprehensive understanding of the Servicemembers Civil Relief Act (SCRA). We want our members to have an industry recognized course needed to effectively serve the housing needs of our military and veteran communities. Our goal is to educate and empower attendees to understand the protections provided by the SCRA for servicemembers. The knowledge from this course can prevent violations like the mortgage violations during the housing crisis 2008. Online Only.

The Fair Housing course is designed for a comprehensive understanding of the Fair Housing Act. We want our members to have an industry recognized course needed to effectively serve

LEADERSHIP ACADEMY OCTOBER 16- 18, 2016 · LAS VEGAS, NV

PAGE 5

the housing needs of all persons interested without Housing discrimination in which an individual or family is treated unequally when trying to buy, rent, lease, sell or finance a home based on certain characteristics, such as race, class, sex, religion, national origin, and familial status. Online Only.

COMING FEBRUARY 29, 2016 www.VAREP.net/university

TESTIMONIALS FROM VAREP MEMBERS

The Military and Veteran Housing Certification (MVHC) is an

This detailed and comprehensive Military and Veteran Housing

essential component to add to every Realtor’s arsenal of experience.

Certification (MVHC) course for REALTORS®, Lenders and Housing

The course provides a wealth of information to professionally assist

Professionals was very empowering and enlightening. The MVHC

over 23 million veterans and active duty personnel, and we must

Resource Manual downloaded from the course is a great and useful

properly serve this important sector of our population. Utilizing the

reference tool. This course helped me develop more confidence

MVHC resources is a great way to say “Thank you.”

in my ability to professionally service my Military and Veteran Chris Prendergast

Families in all aspects of the VA loan process. It required a detailed

VAREP Honolulu Chapter Community Outreach, REALTOR®

review of the entire process and reinforced my ability to become a knowledgeable VA Real Estate Professional.

After taking the MVHC course I realized that though I was pretty

General Bob Hipwell

educated and experienced on VA loans, but there were still certain

VAREP Sacramento Chapter President, Associate Broker

aspects about the program that I was not aware of or perhaps just needed some extra polishing up on. It is about time an independent

This course was very informative and helped build my confidence in

3rd party took the time to both educate and monitor those of us

all aspects of the VA loan. It required a detail review and reinforced

in the real estate and finance world that see Veterans as our niche

the need to be or become an expert VA loan expert. I was able to

clients. I am very happy to be associated with VAREP and to serve

share my experience with other veterans and colleagues.

the honorable men and women of the US Armed Forces.

Ricardo Pacheco Eric Kandell

Marine, VAREP Sacramento Chapter Treasurer, Lender

VAREP Member, Lender

Enjoy the Education, Enjoy the Experience, and Enjoy Serving Those Who Have Served Us! 4

VAREP NATIONAL EVENTS

OCTOBER 16 - 18, 2016 | LAS VEGAS, NV

The Leadership Academy will educate, develop, and empower current and future leaders within the VAREP organization. The Academy equips VAREP leaders with the necessary tools to serve the military and veteran housing needs.

FOR MORE INFORMATION AND TO REGISTER www.varep.net/leadershipacademy

JUNE 5 - 7, 2016 | WASHINGTON D.C. | GRAND HYATT WASHINGTON

The Policy Conference gives our members the opportunity to literally be the voice for veteran homeownership during preset Capitol Hill Visit appointments. Hill visits give members the opportunity to meet with members of Congress and the senate to advocate VAREP’s 2016 Policy Positions that affect military and veteran homeownership.

FOR MORE INFORMATION AND TO REGISTER www.varep.net/policyconference

SAVE THE DATES!

6

CFPB Releases Tool to Help Measure Financial Well-Being Resource Will Provide Questions Financial Educators Can Use to Assess the Financial Wellness of Consumers

7

CFPB ARTICLE

WASHINGTON, D.C. — Today the Consumer Financial Protection Bureau (CFPB) is releasing a tool to measure consumer financial well-being, based on a definition that the Bureau released in January 2015. This first-of-its-kind tool provides questions that educators and others working to build financial capability can use to accurately and consistently quantify the financial well-being of consumers.

“A key part of our mission is providing resources that aid and

working with consumers to quantify the consumer’s financial wellbeing. Financial educators can use the scale in a variety of ways: • Initial assessment: The scale can be used to assess a person’s financial well-being when a financial educator first begins working with a consumer, and help guide an initial conversation about the consumer’s financial situation.

• Tracking progress over time: The scale can be used at

empower people to lead stable and healthy financial lives,” said

different intervals to track a consumer’s financial well-

CFPB Director Richard Cordray. “Our financial well-being tool

being over time. Changes in answers to certain questions

will give financial educators an important means by which to

can provide additional insights to how a consumer’s

evaluate and support consumers’ financial health.”

financial well-being is evolving.

In January 2015, the CFPB released a report that provided a definition of financial well-being, drawing on interviews with consumers across the country, relevant research, and consultations with leading financial education experts. The report defined financial well-being as “a state of being wherein a person can fully meet current and ongoing financial obligations, can feel secure in their financial future, and is able to make choices that allow them to enjoy life.”

• Assessing program outcomes: The scale can be used to gauge how well a program is improving the financial wellbeing of the individuals it is designed to serve.

• Financial well-being survey research: The scale can be used in survey research to analyze the relationship between financial well-being and other factors.

The new tool is comprised of 10 questions that financial educators can use when working with clients to measure their financial security and overall sense of financial well-being. The questions that make up the scale are built around the four elements of financial well-being that were published in the January 2015 report. The four elements are: Procedures Act (RESPA).

• Financial security in the present: This element focuses on whether consumers feel they have control over their dayto-day and month-to-month finances.

• Financial security in the future: This element focuses on whether consumers feel they have the capacity to absorb an unexpected financial shock.

• Present financial freedom of choice: This element focuses on whether consumers feel they have the ability to make choices that allow them to enjoy life.

• Future financial freedom of choice: This element focuses on whether consumers feel they are on track to meet their longer term financial goals.

The Consumer Financial Protection Bureau (CFPB) is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. www.Consumerfinance.gov CFPB COMPLAINT CONTACT INFORMATION: Hours of Operation: Monday through Friday, 8am - 8pm EST Toll Free Number: (855) 411-CFPB (2372) Español: (855) 411-CFPB (2372) TTY/TDD: (855) 729-CFPB (2372) Fax Number: (855) 237-2392 Consumer Financial Protection Bureau P.O. Box 4503

While consumers already have a sense of their financial wellbeing, this tool is designed to allow educators and others who are

Iowa City, Iowa 52244 www.Consumerfinance.gov/Complaint 8

2016 VA Disability Compensation Rates

Department of Veterans Affairs 路 Updated May 2012 9

DEPENDENTS ALLOWANCE:

70% - 100% WITHOUT CHILDREN

In addition veterans entitled to compensation whose disability is rated as 30 percent or more, shall be entitled to additional compensation for dependents as follows (monthly amounts):

WITHOUT CHILDREN: Disability Rating: 30% - 60% Disability Rating: 70% - 100%

WITH CHILDREN: Disability Rating: 30% - 60% Disability Rating: 70% - 100%

10% - 20% (WITH OR WITHOUT DEPENDENTS) PERCENTAGE

RATING

$133.17

%20

$263.23

10% - 20% (WITH OR WITHOUT DEPENDENTS) 30

40

50

60

$587.36 $836.13 $1,059.09

70

80

90

100

Veteran Alone

$1,334.71 $1,551.48 $1,743.48 $2,906.83

Veteran with Spouse Only

$1,447.71 $1,680.48 $1,888.48 $3,068.90

Veteran with Spouse and One Parent

$1,538.71 $1,784.48 $2,005.48 $3,198.96

Veteran with Spouse and Two Parents

$1,629.71 $1,888.48 $2,122.48 $3,329.02

Veteran with One Parent

$1,425.71 $1,655.48 $1,860.48 $3,036.89

Veteran with Two Parents

$1,516.71 $1,759.48 $1,977.48 $3,166.95

Additional for A/A spouse (see footnote b)

$104.00

$ 118.00

$133.00

$148.64

30% - 60% WITH CHILDREN DEPENDENT STATUS

%10

DEPENDENT STATUS

DEPENDENT STATUS

30%

40%

50%

60%

Veteran with Spouse and Child $491.75

$699.36

$976.13

$1,227.09

Veteran with Child Only

$439.75

$630.36

$890.13

$1,124.09

Veteran with Spouse, One Parent and Child

$530.75

$751.36

$1,041.13 $1,305.09

Veteran with Spouse, Two Parents and Child

$569.75

$803.36

$1,106.13 $1,383.09

Veteran with One Parent and Child

$478.75

$682.36

$955.13

Veteran with Two Parents and Child

$517.75

$734.36

$1,020.13 $1,280.09

$,1202.09

Veteran Alone

407.75

Veteran with Child Only

$455.75 $651.36 $917.13

$1,156.09

Veteran with Spouse & One Parent

Add for Each Additional Child Under Age 18

$24.00 $32.00 $40.00 $48.00

$494.75 $703.36 $982.13

$1,234.09

$78.00 $104.00 $130.00 $156.00

Veteran with Spouse and Two Parents

Each Additional Schoolchild Over Age 18 (see footnote a)

$533.74 $755.36 $1,047.13 $1,312.09

Additional for A/A spouse (see footnote b)

$44.00 $59.00 $74.00 $89.00

Veteran with One Parent

$446.75 $639.36 $901.13

$1,137.09

Veteran with Two Parent

$485.75 $691.36 $966.13

$1,215.09

Additional for A/A spouse (see footnote b)

$44.00

$59.00* $74.00

$89.00

70% - 100% WITH CHILDREN DEPENDENT STATUS

70%

80%

90%

100%

Veteran with Spouse and Child $1,530.71 $1,775.48 $1,995.48 $3,187.60 FOOTNOTES: A. Rates for each school child are shown separately. They are not included with any other compensation rates. All other entries on this chart reflecting a rate for children show the rate payable for children under 18 or helpless. To find the amount payable to a 70% disabled Veteran with a spouse and four children, one of whom is over 18 and attending school, take the 70% rate for a veteran with a spouse and 3 children, $ 1,642.71, and add the rate for one school child, $182.00. The total amount payable is $1,824.71.

B. Where the veteran has a spouse who is determined to require A/A, add the figure shown as “additional for A/A spouse” to the

Veteran with Child Only

$1409.71 $1,637.48 $1,840.48 $3,015.22

Veteran with Spouse, One Parent and Child

$1,621.71 $1,879.48 $2,112.48 $3,317.66

Veteran with Spouse, Two Parents and Child

$1,712.71 $1,983.48 $2,229.48 $3,447.72

Veteran with One Parent and Child

$1,500.71 $1,741.48 $1,957.48 $3145.28

Veteran with Two Parents and Child

$1,591.71 $1,845.48 $2,074.48 $3,275.34

Add for Each Additional Child Under Age 18

$56.00

Each Additional Schoolchild Over Age 18 (see footnote a)

$182.00

Additional for A/A spouse (see footnote b)

$104.00 $118.00 $133.00 $148.64

$64.00 $208.00

$72.00

$80.52

$234.00 $260.13

amount shown for the proper dependency code. For example, veteran has A/A spouse and 2 minor children and is 70% disabled.

Add $104.00, additional for A/A spouse, to the rate for a 70% veteran with dependency code 12, $1,586.71. The total amount payable is $1,690.71.

These rates were provided by the Department of Veterans Affairs. The original copies can be found on the Department of Veterans Affairs website http://www.benefits.va.gov/COMPENSATION/resources_comp01.asp 10

HOW TO BATTLE DISCRIMINATION AGAINST VETERANS AND VA LOANS

by Scott Schang on 11.22.15 in VA

THE UGLY TRUTH There is a very disturbing and ugly pattern of discrimination against VA Loans that happens in the real estate industry and that must change. Veterans that qualify for VA home loan benefits are having difficulty getting offers accepted to buy a home. The reason they are not being considered? Because they are using VA financing.

I wouldn’t go so far as to say that sellers do not like VA Loans or Veterans, and I am not implying that the real estate agent that represents the buy has anything specifically against Veterans, but I am telling you that these real estate agents will not consider accepting an offer because of the type of financing, not the person trying to buy the home.

11

HOW TO BATTLE DISCRIMINATION AGAINST VETERANS AND VA LOANS

WHY THE DISCRIMINATION? Guidelines change all the time in our industry, and the VA home loan is no exception. There was a time when the VA home loan had certain restrictions that would not allow the Veteran to pay certain closing costs associated the the purchase of a home.

The burden of these costs typically fell on the seller. It is understandable that this could cause some reluctance on both the seller, and the agent’s part to accept these offers. I guess what makes me most upset is that these guidelines have been changed for years.

While there are still costs that the Veteran is not allowed to pay, lenders have the ability to cover all of these closing costs through the loan. By taking a slightly higher interest rate (and I mean slight!), we are able to pay all costs for any Veteran trying to buy, or refinance a home. Problem solved.

My greatest frustration comes from the fact that real estate agents do not even bother to learn about the VA home loan, and how it directly benefits our military personnel. It is almost impossible to show gratitude equivalent to the sacrifices that our military men and women make to keep us safe. The VA home loan benefit is one small way to try to get close.

WHY THE DISCRIMI REQUIREMENTS FOR VA LOANS NATION? Wartime Eligibility – Veteran service during wartime periods: • WWII: 9/16/1940 to 7/25/1947 • Korean: 6/27/1950 to 1/31/1955 • Vietnam: 8/5/1964 to 5/7/1975

You must have at least 90 days on active duty and been discharged under other than dishonorable conditions. If you served less than 90 days, you may be eligible if discharged for a service connected disability.

Peacetime Eligibility – Veteran service during peacetime periods: • • • •

7/26/1947 to 6/26/1950 2/1/1955 to 8/4/1964 5/8/1975 to 9/7/1980 (Enlisted) 5/8/1975 to 10/16/1981 (Officer)

You must have served at least 181 days of continuous active duty and been discharged under other than dishonorable conditions. If you served less than 181 days, you may be eligible if discharged for a service connected disability.

Service after 9/7/1980 (enlisted) or 10/16/1981 (officer)

WHO IS AFFECTED BY THIS DISCRIMINATION? The VA home loan benefit offers far more flexible qualifying guidelines than other mortgages, including higher loan limits, shorter waiting periods after financial hardship, and best of all – NO DOWN PAYMENT!

If you were separated from service which began after these dates, you must have the following to qualify for VA Loans : • Completed 24 months of continuous active duty or the full period (at least 181 days) for which you were ordered or called to active duty and been discharged under conditions other than dishonorable, or • Completed at least 181 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1171 (Early Out), or have been determined to have a compensable service-connected disability; • Been discharged with less than 181 days of service for a service-connected disability. Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances for the convenience of the Government.

12

Gulf War – Service during period 8/2/1990 to date yet to be determined If you served on active duty during the Gulf War, you must have: • Completed 24 months of continuous active duty or the full period (at least 90 days) for which you were called or ordered to active duty, and been discharged under conditions other than dishonorable, or • Completed at least 90 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1173 (Early Out), or have been determined to have a compensable service-connected disability, or • Been discharged with less than 90 days of service for a serviceconnected disability. Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances, for the convenience of the Government.

deal with flashbacks, nightmares & intrusive thoughts If you are now on regular duty (not active duty for training), you are eligible after having served 181 days (90 days during the Gulf War) unless discharged or separated from a previous qualifying period of active duty service.

SELECTED RESERVISTS OR NATIONAL GUARD If you are not otherwise eligible and you have completed a total of 6 years in the Selected Reserves or National Guard (member of an active unit, attended required weekend drills and 2-week active duty for training) and • Were discharged with an honorable discharge, or • Were placed on the retired list, or • Were transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable service, or • Continue to serve in the Selected Reserves Individuals who completed less than 6 years may be eligible if discharged for a service-connected disability.

UN-REMARRIED SURVIVING SPOUSES AND SPOUSES OF POW OR MIA • Are an un-remarried spouse of a Veteran who died while in service or from a service connected disability, or • Are a spouse of a serviceperson missing in action or a prisoner of war Note: Also, a surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003, may be eligible for the home loan benefit. However, a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must apply no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 6, 2003 that are received after December 15, 2004.

Eligibility may also be established for: • Certain United States citizens who served in the armed forces of a government allied with the United States in WW II. • Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with WW II service, and others.

WHAT’S THE SOLUTION? Education is the solution. If you are eligible for VA home loan benefits, make sure that your real estate agent is familiar with the guidelines of VA financing, and willing to fight for you. Battling the ignorance of uneducated real estate professionals, and sellers, is something we have to do one person at a time.

If you are having a hard time getting your offer accepted, it may be VA discrimination, and you may need to find a better home buying team to fight for you.

ABOUT SCOTT SCHANG As a 17 year veteran of the Mortgage and Real Estate industry, I am passionate about educating and empowering consumers. I have been writing about consumer protection issues, and making sense of complicated real estate and mortgage topics on this website

13

HOW TO BATTLE DISCRIMINATION AGAINST VETERANS AND VA LOANS

14

FROM

HERO TO

HOMEOWNER

FROM HERO TO HOMEOWNER

FROM HERO TO HOMEOWNER By: Steve Bergsman Last year, Tony Adkins was ranked by an industry trade publication as the 10th-busiest originator of Department of Veterans Affairs (VA) loans. What’s particularly noteworthy about that achievement is Adkins is a senior vice president of the Western region for the relatively small Phoenix-based lender Alliance Financial Resources LLC (dba Alliance Home Loans). There are 1,500 licensed VA lenders in the country, and according to the government agency, by third-quarter 2015 loan volume, Alliance Financial squeezed into the top-100 rankings at position 94. That’s just one spot behind North Texas Financial Network, Plano, Texas, and ahead of Colonial National Mortgage, Fort Worth, Texas. ^ Unfamiliar with some of those names? That might be because the VA lending business has been dominated by a wide assortment of nonbank lenders- not the big commercial banks, with a few exceptions. 1) According to the VA, from third-quarter 2014 to third-quarter 2015, the only big banks in the top 10 for loan volume were San Francisco-based Wells Fargo & Co. at No. 4 and Charlotte, North Carolina-based Bank of America at No. 10. H The other lenders in the top 10: Quicken Loans, Detroit, (No. 1); Freedom Mortgage Corporation, Mount Laurel, New Jersey (No. 2); USAA, San Antonio, Texas (No. 3); Mortgage Research Inc., New York (No. 5); Navy Federal Credit Union (NFCU), Vienna, Virginia (No. 6); loanDepot LLC, Irvine, California (No. 7); Flagstar Bancorp Inc., Troy, Michigan (No, 8); and Sun West Mortgage Co. Inc., Cerritos, California (No. 9).

“Banks used to dominate the top 10,” observes John Bell III, assistant director of loan production and valuation at the Department of Veterans Affairs. “At the end of the day, we are grateful that non-banks have been supportive of veterans and the program.”

Independents “just crush the big banks when it comes to VA loans,” asserts Louise Thaxton, a regional manager who heads VA lending efforts and the military boot camp campaign for Fairway Independent Mortgage Corporation (ranked No. 27

by VA for loan volume in the third quarter), from her office in Leesville, Louisiana.

“If you look at a fast-growing state like Arizona, USAA is No. 1.

Wells Fargo is No. 5,” she says. “The way I sustain market share even in military towns is that I can close a loan in 10 days. The big banks can take 45 days.”

It’s not just about speed. As Adkins points out, “I can’t say I find a lot of competition when it comes to pricing, at least as compared to the big banks.”

16

It’s not just about speed. As Adkins points out, “I can’t say I find a lot

but not necessarily steady as outside economic factors such as the

of competition when it comes to pricing, at least as compared to the

Great Recession in the mid-2000s depressed the overall mortgage

big banks.”

business.

He adds, “I’ve done thousands of VA loans, and I always say, ‘Please

From 2003 through 2007, VA loans were in a decline, dropping all

shop around so that you are confidant you are receiving the best

the way from 489,000loans originated to 133,000,according to the

possible deal.’ Many walk across the parking lot and stop at Wells

VA. Then as financial markets collapsed and the recession ensued

Fargo. They come back and say to me, ‘They offered the same loan

many kinds of mortgages became very difficult to obtain. Yet during

with only $3,000 more in closing costs.’”

this period VA lending started to pick up again, climbing to a peak of

There are about 800,000 loan originators in the country, Adkins estimates, so a top-10 ranking for VA loans is pretty darn goodexcept this year it will be even better. For the first half of 2014, Adkins originated 261 VA loans. Through the first half of 2015, he estimates he’s done 300 VA loans.

But better numbers don’t necessarily ensure a better ranking.

Everyone seems to be doing more VA loans in 2015.

VA lending dropped as well to 438,000loans. By the end of the third quarter, the VA had already surpassed 600,000again this year, says Bell, and there are some additional indicators that are very encouraging.

“Prior to fiscal year 2013, the last big year was in fiscal year 1994 when the VA guaranteed just over 600,000loans-but the big difference is the makeup of the portfolio. In 1994 and 2013, the VA Interest Rate Reduction Refinance Loan [IRRRL], which [is a loan] where veterans

A cannonade of work

refinance an existing VA loan, made up 48 percent of originations,

The VA loan was always an enviable financial construct. It could

means that 69 percent of veterans are either purchasing property or

cover 100 percent of the mortgage, there’s no down payment or

refinancing an existing non-VA loan into a VA loan,” he says.

mortgage insurance and it’s cheaper than a conventional mortgage.

The lenders’ perspective

The VA loan offers a lower interest rate than any other product out there, Bell says. When Mortgage Banking checked in with Bell in late summer, he reported the average interest rate on a conventional loan was 4.218 percent, the Federal Housing Administration (FHA) loan sat at 4.047 percent and the VA loan looked good at 3.81 percent.

The attractiveness of the VA loan was always there, but the program was somewhat under the radar even for some veterans. That all has changed in recent years.

whereas in 2015 it only accounts for 31 percent of loans closed. This

Individual lenders with a strong commitment to VA lending boasted similar numbers. In 2012,VA loan volume for Alliance Financial was $75 million, which jumped to $170 million in 2013 and then $200 million in 2014,reports Jamie Korus, CMB, president of Alliance Financial. When Mortgage Banking interviewed Korus toward the end of the summer, the company’s volume was already at $180 million and it was fully expecting to break last year’s record numbers for VA loans.

Even though other high-water marks could be partially attributed to refinance booms, not this year, says Bell. “In 2015, our purchase volume

The VA has amped up marketing and education, and then on the

was up considerably. We have achieved a50-50 type balance between

technical end, new efficiencies have been introduced from further

purchase and refinance,” he says.

automation of loan processing. Lenders have found the VA loan to be a good product offering and they, too, have improved their own education and outreach.

Also, the mindset of new veterans is much different than those who served in the Vietnam War-the last lengthy, major war involving the United States before its participation in Middle East/Persian Gulf conflicts.

Asked what has made the difference in the market, especially for homebuyers, Bell attributes a good part of that success to automation and invigorated education efforts with the Realtor® and real estate agent community.

“We have been doing a lot of proactive communications with Realtors and real estate agents,” he says. “ And we have been automating our processes, which makes our program more

Finally, with President Obama seeking a drawdown of active-duty

attractive. In particular, we have streamlined our eligibility process.

personnel after extended conflicts in Iraq and Afghanistan, a

Right now, over 90 percent of our eligibility inquiries go through

wave of new veterans has been entering the market and most are

an automated review; 70 percent of applicants receive an automatic

of the sought-after age group known as millennials (anyone born in

determination in seconds.” There is also a different mindset among

the years 1982-2004). Since 2008, the origination volume of VA

young veterans.

loans is up 141 percent, reports Bell.

The overall trend line for the past 10 to 15 years has been upward, 17

629,000 by 2013. The mortgage market tightened up in 2014, and

Although there has been an increase in VA loan volume primarily due to a shift in veterans’ awareness, it is not enough, Potter adds. Alliance

FROM HERO TO HOMEOWNER

Financial Resources, along with the VA, is pushing

discharged due to the draw down,” says Calk.

veteran mortgage awareness and education, and we have helped enlighten the veterans [about]the

“More of them are entering the civilian workplace,

mortgage benefits the VA offers. “As veterans become

making that transition from active duty to civilian lives,

more aware of these benefits, more and more are using

and they are finally at a point where they are in a

[VA- guaranteed] mortgage loan programs as a great

place long enough to think about homeownership,” he

vehicle to acquire home loans with little or no money

adds.

down,” he says. “I’ve noticed in the last 20 years, loan

The ex-military millennlals

origination volume increased,” Potter adds. “When service members leave the military, it can be like

Navy Federal Credit Union has an obvious built-in

leaving the hospital-especially when someone says to

advantage when it comes to VA loans: Basically, if,

you, ‘Here’s all the things you’ll need to do when you

as active-duty military, you are eligible to join the

get home,”’ says Thaxton.

NFCU you are also going to be eligible for a VA loan.

“With the military, someone says, ‘Here are all your benefits, one of which is the VA loan,’ and when they

Yet, even the NFCU has seen its business explode in recent years.

return home they stick it all in a drawer and forget

“We have been going gangbusters on VA loans,”

about it. People need to bring the VA loan to their

exclaims Katie Miller, Navy Federal Credit Union’s

attention,” she says. Fairway is much more aggressive

vice president of mortgage lending. “In 2014 it was

today about getting the message out than it was a

about 54 percent of our business. Last year, we did

decade ago, says Thaxton. “It is about understanding

almost 18,000VAloans. Our total loan volume portfolio

the culture, mindset and core value of the military,”

is up 80 percent in 2015-we could be doing as much

she explains. “Most combat veterans come home a

as 50,000 loans this year, and 50 percent or more

changed person. You can take a warrior out of

of that will be VA loans. At the beginning of autumn,

the war, but it’s harder to take the war out of the

NFCU had already surpassed 18,000 VA loans.”

warrior. What does this have to do with the mortgage?

NFCU staffed up this year and has trained all

Well, you have to understand that mindset and you

personnel on the intricacies of VA lending. “We

have to be empathetic. They don’t want sympathy,

do beginner training for every loan officer, then

but you can empathize to understand some of their

training for processors, and the next course in their

challenges.”

curriculum is specific VA training,” says Miller.

To successfully reach out to ex-military when it comes

The NFCU’s top three markets are, as one would

to VA home loans, some lenders such as The Federal

expect, around the Navy port cities of San Diego

Savings Bank (ranked No.40 by VA in regard to third-

and Norfolk, Virginia; plus the Washington, D.C.,

quarter loan volume), Chicago, turns to ex-military.

metro area. As Miller notes, she can control the

“Our team is a combination of veterans and VA loan specialists, and as a result, we not only have tremendous understanding and sympathy, we speak the language=we understand the experience better than any other financial institution possibly could,” says Steve Calk, chairman and chief executive officer of The Federal Savings Bank. “We’ve been there.’’

The Federal Savings Bank also plans to be there in the years ahead, because it understands that VA lending will be an expanding business in the near future-especially with the coveted millennial age group that the U.S. Census Bureau projects will surpass baby boomers in 2015 as the nation’s largest

number of loan officers in her organization, but if there is any backup in processing because of excessive origination volume, it comes on the appraisal side, as “in certain areas of the country we need more VA-qualified appraisers for quicker turnarounds,” she says.

As for the product, Miller says, “Everyone in the industry is talking about first-time homebuyers, because that is where the opportunities

are going

to come from in the future. Well, the VA product is 100 percent ideal for that population due to pricing, no down payment and the loan covering 100 percent of the purchase price.”

living generation.

“Over 500,000 service people per year are being 18

Apparently Miller is right on about the VA loan, because the average age of the military first-time homebuyer

was younger than the average age of the non-military homebuyer.

In February 2015, Navy Federal Credit Union published the results of a survey it had done that took a look at this market of ex-military millennials, trying to get a bead on. the demo• graphic group’s financial needs, which surprisingly wasn’t as profound as economists would have us believe about millennials in general.

Among the survey results: • Millennials serving in the military are more likely to estab• lish long-term financial goals compared with their civilian counterparts.

• Ex-military millennials feel better prepared to meet those long-term goals.

• Sixty-six percent of millennials on active duty or with an active-duty spouse have started planning their financial future, while 49 percent of civilian millennials can say the same. I Fifty-eight percent of military millennials feel they have the financial literacy to meet their goals, compared with 37 percent of civilians.

• Eighty-nine percent of military millennials say they are currently on track to achieve their five-year financial goals, compared with 78 percent of millennials in the general population.

What does all this mean?

If you are satisfied with your financial status, you are more ready to invest in a home-at least more ready than the average millennial. “Once veterans get stable, they want to buy a house and live some of the American dream they fought so hard to defend,” says Calk. “On the purchase side, there are a lot of ex military millennials who are first-time homebuyers. That’s why this market is so critical-that’s why we spend so much money educating our veterans as to how they can buy a home, how to qualify, how the VA loan works and why it is the best loan for them.” About 30 percent of VA loan volume nationwide is going to millennials in the 25-to-34 age group, says Bell.

Extra selling points Apparently VA home loan education and marketing efforts have been successful. “There are a greater number of veterans who are now aware that this product exists and is exclusively for them,” says Korus.

For independent lenders, the thing about VA lending is that the competition is not as great as with some other loan products, Korus adds. “If you look at, for example, credit unions, many don’t offer this product.

It does take additional personnel and costs associated with originating the loan because of the required designations and know-how to handle the additional requirements after the loan closes. In addition, being an independent mortgage banker means we have multiple outlets to deliver the product.”

Alliance Financial se1Is all its VA loans, and there are many buyers that want these loans. For good reason, this is a mortgage that rarely defaults. “We call this ‘the filet of loans,’ because it has the least amount of default rates,” says Alliance Financial’s Adkins. “VA loans are some of the best-performing loans in any portfolio over time,” says Calk. “The simple fact of the matter is, the character of the veterans is such that they make their mortgage payments.”

The VA loan is a good investment all around, Calk adds, “It’s a good investment on behalf of the people supporting the veterans to get homeownership, it’s a good investment for those who lend them the money and it’s a good investment for those who service the loans and buy the securities based on those loans.”

As of the end of third-quarter 2015, the foreclosure inventory for a conventional prime loan was 1.19percent, for a normal FHA loan it was 2.68 percent and for a VA loan it was 1.37 percent, reports Bell. “It starts with sound underwriting standards, including the residual income requirement, which looks at net income after all expenses are paid in case a one• time, unexpected issue arises and veterans can still make their payments.

19

FROM HERO TO HOMEOWNER

We try to set the veterans up for success. We have loan technicians

Connor, chief executive officer of The Bunker, in a You’Iube’” video.

available to help veterans if they experience financial difficulty.

Essentially, the program helps military veterans tap into existing

These employees help veterans to navigate the servicing process,

government programs while also providing networking opportunities

including giving advice and counsel to mitigate circumstances out

for breaking into the technology sector. “To be a VA lender, there is

of their control, and talking to servicers on the veteran’s behalf.”

nothing special about that,” says Calk. “It’s a special loan reserved

A unique group of borrowers

for a special population.

To be a good lender here, you just need to lend to people of

The VNs mission is to maximize veterans’ and service members’

character who have a history of paying their bills back. The single

opportunities to obtain, retain and adapt homes by providing a

best way to judge future performance

viable and fiscally responsible benefit program in recognition of

past performance. There are ex-military who have earned that

their service to the nation.

[reputation for] discipline and understand the principals of

“We believe very strongly about not just getting veterans into a home, but also staying in that home as long as they want to be there. That is one of the reasons that we continue to have the lowest foreclosure inventory rate of any loan pro• gram out there,” says Bell.

For many of the successful independent lenders that really want and go after the VA loan market, it’s also about going that extra mile to be of assistance to the veteran. Some lenders such as Fairway Independent Mortgage and The Federal Savings Bank go out of their way in several respects to support veterans. Fairway’s charitable program is called the American Warrior Initiative, which last year sponsored 22 Certified Military Residential Specialist boot camps around the nation. It was expected the American Warrior Initiative would do another 25 this year. The

homeownership.

is to look at someone’s

These loans will outperform every other loan

class out there.” Calk concludes, “Veterans acutely understand the value of homeownership.

They spend a tremendous amount of

time, energy and effort defending these values, and the American dream for them is still to own a piece of the rock.” IVB

ABOUT THE AUTHOR Steve Bergsman is an author, journalist and travel writer with more than twenty-five years writing books, and articles for magazines and newspapers. His stories have been published in more than 100 publications around the world, and he has appeared on local and national radio and television.

Bergsman is the author of seven books:

idea, says Thaxton, is to educate, train and inspire real estate, title and mortgage professionals to give back in some way to service

-- The novels of historical fiction, The Seduction of Mary Wells and

members.

The Death of Johnny Ace. Now published by SMBCOMM. The Death of Johnny Ace originally published by Dancing Traveller Publishing,

In addition, most of the Fairway employees donate monthly to

Vancouver.

their nonprofit through payroll deduction, which goes toward initiatives to give back to “wounded heroes.” Over in Chicago,

-- The memoir/social history, Growing Up Levittown: In A Time Of

The Federal Savings Bank’s Calk sits on the board of directors of

Conformtiy, Controversy and Cultural Crisis. Now published by

the USO of Illinois, which helps veterans as they travel from duty

SMBCOMM. Originally published by Dancing Traveller Publishing,

station to duty station.

Vancouver.

The lender is also a big supporter of Chicago-based Bunker Labs,

-- The real estate books, After The Fall: Opportunities & Strategies for

often just called The Bunker, which is a veteran-operated, veter•

Real Estate Investing In the Coming Decade; Passport To Exotic Real

an-focused effort with an emphasis on finding and offering

Estate; Maverick Real Estate Financing; Maverick Real Estate Investing.

entry points into the technology community, explains Todd

All published by John Wiley & Sons, New Jersey.

20

DEPARTMENT OF VETERANS AFFAIRS QUALIFIED MORTGAGE INTERIM FINAL RULE

FREQUENTLY ASKED QUESTIONS Circular 26-16-03 • January 20, 2016 Exhibit A

21

1. What is the Ability to Repay (ATR)?

A1. In the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”), Congress required that, for residential mortgages, creditors must make a reasonable and good faith determination based on verified and documented information that the consumer has a reasonable ability to repay the loan according to its terms.

2. What is a Qualified Mortgage (QM) in VA’s home loan program?

A2. VA defines QM to mean any loan that is guaranteed, insured, or made by VA; however, certain limitations apply to Interest Rate Reduction Refinance Loans (IRRRLs). These limitations are discussed below.

3. As of what date did VA’s Ability to Repay (ATR) standards and Qualified Mortgage (QM) definition become effective?

A3. VA’s ATR standards and QM definition were published in the Federal Register as an Interim Final Rule (IFR) on May 9, 2014. See 79 FR 26620. The IFR became effective on the date of publication.

4. Are there different types of QMs in VA’s home loan program?

A4. All VA purchase-money loans that meet the QM requirements established in 38 C.F.R. § 36.4300(b) are Safe Harbor QMs. In order for an IRRRL to have Safe Harbor QM status, it must meet the requirements of 38 CFR § 36.4300(c)(1), further explained below. If an IRRRL does not meet the Safe Harbor requirements, but it meets the basic requirements for guaranty, it is a QM with the rebuttable presumption that the borrower has the ability to repay the loan.

5. Did the IFR require substantial changes to the way lenders underwrite VA guaranteed loans?

A5. No, the IFR did not result in substantial changes to the way lenders underwrite VA-guaranteed loans. The purpose of the IFR was not to change the way loans are processed for guaranty, but to establish whether a loan would be a QM and, if so, which type.

5. Did the IFR require substantial changes to the way lenders underwrite VA guaranteed loans?

A6. If the IRRRL meets the three requirements listed below, it will be considered a Safe Harbor QM and the lender is not required to perform credit underwriting: 1. The loan being refinanced was originated at least 6 months before the new loan’s closing, at least 6 payments have been made on the original loan, and the Veteran has not been more than 30 days past due during the 6 months preceding the new loan’s closing date; and 2. All fees and charges financed as part of the loan or paid at closing (i.e., all expenses associated with the cost of the refinance) are in compliance with 38 C.F.R. § 36.4313, and such fees are shown to be recouped within 36 months 22

of the new loan closing. Note that VA excepts from the recoupment requirement, the following three types of IRRRLs: 1) mortgages that include energy efficient improvements, 2) loans that are being refinanced from an adjustable-rate to a fixed- rate, and 3) loans which a refinance a fixed-rate loan into another fixed-rate loan of a shorter duration; and 3. The requirements set out in A12, below, related to exemption of income verification are satisfied. Lenders should note that if the IRRRL cannot be exempted from income verification (as set forth in A13, below), the loan can still be deemed a safe harbor QM, IF the lender verifies the borrower’s income in accordance with VA’s underwriting requirements found at 38 C.F.R. § 36.4340. If the loan is not exempted from verification, and if the lender does not verify the borrower’s income in accordance with 38 C.F.R. § 36.4340, then the new IRRRL cannot be considered a safe harbor QM.

7. Will VA still guaranty the loan if the IRRRL does not meet the recoupment period of less than 36 months, or does not meet the 6-month seasoning requirements?

A7. Yes, VA will guaranty the loan; however, the loan will not have Safe Harbor QM status. Instead, it will be a Rebuttable Presumption QM. VA does not condition the guaranty on satisfaction all of the QM requirements. Lenders should consult their legal staff regarding safe harbor and rebuttal presumptions QMs.

8. What is the date that begins the seasoning and recoupment periods?

A.8. The date of the note is the date on which legal obligations are established between borrower and lender.

Therefore, to calculate the seasoning period, the lender should use the date of the note that is being refinanced. The starting date for recalculating the recoupment period is the date of the new IRRRL note.

9. Are pre-paid expenses, such as real estate taxes and home owners’ insurance counted in total closing costs for the 36-month recoupment period?

A9. No, only those expenses the veteran incurs as a cost of the IRRRL must be included in the recoupment period. VA does not believe it is necessary to include in the recoupment period the costs of items the borrower would have paid anyway under the loan being refinanced. The purpose of the recoupment calculation is to demonstrate the difference in out-of-pocket or financed expenses between the original loan and the new IRRRL. Consequently, if expenses like homeowners’ insurance premiums, taxes, special assessments, and homeowners’ association fees were, or would have been, payable under the original loan, they are excluded from the recoupment calculation.

10. If I submit a loan for VA prior approval that is considered a Rebuttable Presumption QM, and VA approves the loan, will the loan have Safe Harbor protections?

A10. No. The type of QM protection would not change simply because VA approved a lender’s underwriting. VA’s approval of underwriting is limited to the validity of the guaranty and does not affect the type of QM designation.

23

11. Can lender credits be excluded from the recoupment calculation?

A11. Whether a lender credit or premium pricing is a cost of the IRRRL, and thus included in the recoupment calculation, depends on whether a lender’s credit is an incentive paid on behalf of the veteran or is a result of some sort of consideration the veteran provides. If the former, the lender credits and premium pricing can be excluded from the recoupment calculation. If the latter, they must be included. In other words, lender credits and premium pricing may be excluded from the recoupment calculation only to the extent they offset fees allowed in 38 C.F.R. § 36.4313.

12. Are there changes to the income verification requirements for IRRRLs? A12. VA continues to exempt IRRRLs from income verification pursuant to 38 C.F.R. 36.4340(b)(2), as long as the following Dodd-Frank Act conditions are met: a. The Veteran is not 30 or more days past due on the loan being refinanced; b. The proposed IRRRL does not increase the principal balance outstanding on the prior existing residential mortgage loan, except energy efficient mortgages and to the extent of fees and charges outlined in 38 CFR 36.4313. c. Total points and fees (as defined in section 103(aa)(4) of the Truth-in-Lending Act (TILA), other than bona fide third-party charges not retained by the mortgage originator, creditor, or an affiliate of the creditor or mortgage originator) payable in connection with the proposed IRRRL do not exceed three percent of the total proposed principal amount; d. The interest rate on the proposed IRRRL is lower than the interest rate on the loan being refinanced, unless the borrower is refinancing from an adjustable-rate to a fixedrate loan, under guidelines that VA has established; e. The proposed IRRRL is subject to a payment schedule that will fully amortize the IRRRL in accordance with VA regulations; f. The terms of the proposed IRRRL do not result in a balloon payment, as defined in TILA; and g. Both the residential mortgage loan being refinanced and the proposed IRRRL satisfy all other VA requirements. VA did not exercise discretion in applying these conditions to the IRRRL program. VA merely recited the criteria required under the Dodd-Frank Act.

13. Is VA prior approval required on a proposed IRRRL that does not meet the requirements for exemption of income verification?

A13. A prior approval submission on a proposed IRRRL is only necessary if the original loan is 30 or more days past due.

14. Is an IRRRL lender responsible for an origination lender’s failure to comply with VA credit underwriting guidelines?

A.14. No, an IRRRL lender is not responsible under the IFR for another lender’s failure to underwrite the loan in accordance with VA credit underwriting guidelines,

24

TO LEARN MORE ABOUT THE

Please visit our website at www.VAREP.net and click the menu item “House a Vet Initiative”

25

HOUSE A VET INITIATIVE

10 HOMES DONATED MORTGAGE-FREE TO DESERVING HEROES

70 HOMES REMODELED & SOLD TO

VETERANS, FIRST RESPONDERS, TEACHERS AND CIVIL SERVANTS

1.4 MILLION

$

SPENT ON HOME REHABILITATION

FOR MORTGAGE-FREE DONATIONS AND VETERAN FIRST RESALE PROGRAM

26

“The willingness with which our young people are likely to serve in any war, no matter how justified, shall be directly proportional to how they perceive veterans of early wars were treated and appreciated by our nation.”

- George Washington

VETERANS ASSOCIATION OF REAL ESTATE PROFESSIONALS info@VAREP.net

w w w . V A R E P. n e t

951- 444 -7363