Comments on: VA Loans

By: Angie Williams

Angie Williams — Thu, 27 May 2010 01:43:26 +0000

I don’t see how this is any different then the WSHFC loan which caps what a lender can make for this specific product.
Again, I don’t have experience in brokering loans but some of the blogs are correct.. they want you to make 2. I agree with Bryce’s comment above as our market area does have a higher price point. Monetary cap would be best.

By: Bryce Zimmerman

Bryce Zimmerman — Sat, 22 May 2010 01:14:44 +0000

They probably should allow lenders to charge additional fees. My experience has always been that most brokers are trying to obtain 2%, but i’ve always thought that is odd. 2% on 100k isn’t much income, yet 2% of $500k is substantial. Instead of using a percentage, they could limit it to a dollar amount, or a combination, 2% not to exceed $8000.

By: Elisa Wu

Elisa Wu — Mon, 01 Mar 2010 00:31:29 +0000

The VA loan sound very reasonable; however, the incentive from bank not very attractive.

By: Kimberly Peterson

Kimberly Peterson — Thu, 31 Dec 2009 20:25:10 +0000

I agree that the VA should allow for a higher percentage then the 1%, I could do the math but I see plenty have already provided it. It definately does not provide much incentive after the other fees are deducted.

By: Karen Tuff

Karen Tuff — Thu, 31 Dec 2009 09:14:28 +0000

I would hope to make more than .5% due to the fact I work this business part time and have another job focus. I would be more inclined to do VA loans if the time and energy could result in a better commission. Half my family is military and I respect everything they do for the country. However, I am fighting to regain my financial footing during this downturn in the economy and it would have to make economic sense for me. I hope there is an improvement in compensation to provide more incentive for more LO’s to work these loans.

By: Harold Burton

Harold Burton — Thu, 31 Dec 2009 04:45:25 +0000

I have no problem doing VA loans at a 1% broker fee. I also agree that there needs at least a .5% increase to cover operating cost an so forth.

If the loan amount is 300K and above there really isn’t a problem. Home values $150K and below makes it hard for companies to operate with a 1.0% broker fee. I’ve always said that volumne solves a host of cost related objections.

By: Kelly Fiscus

Kelly Fiscus — Wed, 30 Dec 2009 23:34:50 +0000

I think it is a choice to do a VA loan or not. If you choose to do the loan you know up front what you will or won’t make. And in our econmy .5% is better than 0%. Also these are vets who have served our country and they deserve the break.

By: Chris Yanke

Chris Yanke — Wed, 30 Dec 2009 23:13:06 +0000

If I am seeing a Loan Amount of $280,000.00 and can only charge a 1% loan fee, the next question I have is rather than just summarizing the underwriting fee and the remaining lender fees that usually come to about $895.00 with a loan amount of this size that is about .31 it’s my opinion to agree with some of the other comments above that a .500% variance should be allowed WITH ITEMIZED EXPLANATION. I believe that VA will in time make this exception but again the motivation of this product is to create a benefit for those who’ve risked all they were gonna have for everything we have.

By: Kelly Fiscus

Kelly Fiscus — Wed, 30 Dec 2009 21:13:30 +0000

My though is you do the VA loan and hope for referrals or repeat business when the client buys the next house and doesn’t use VA. Keep in mind these are people who served in the miltary protecting all of us.

By: James Haechler

James Haechler — Wed, 30 Dec 2009 05:25:39 +0000

I worked for a VA company for 2 1/2 years. Working three states. They made 3-4% on every loan. Every VA qualified for refinancing. Good, bad credit didn’t matter. Drive by appraisals. Everything was bundled and sold to investors with the VA guarantee. We provided a great service for all Veterans. To see the origination fee at 1% would hurt the Veterans. Brokers and LO’s wouldn’t touch them at 1% less fees. Maybe a middle ground with a mim origination fee of $2500 and a max fee of $4500 depending on the loan size.

By: Jason Brock

Jason Brock — Wed, 30 Dec 2009 00:38:43 +0000

VA Loans:
Wow… working for .5%… let me see $1,250 on a 250k loan… how many hours did the LO work on that file? More importantly how many bullets did that lazy LO have to dodge? Base pay for an E3 in the air force is less than $1,100 month to make the rank of E-3 it takes 3-4 years of hard work… no cozy office… that is dodging bullets and serving our country proudly. Anyone who does not want to work for that to serve our armed forces please feel free to send that referral my way and I will gladly do my part to help. PS. I did my 6 years USAF. NO PAY RAISE

By: Jerrod Goode

Jerrod Goode — Mon, 28 Dec 2009 23:46:51 +0000

Allowing for a little more profit to brokers would be the right thing to do. If the incentive is not there for brokers to offer this product it will only hurt the sevicemen who are trying to take advantage of one of the few perks they get. This small margin is very tough to get excited about.

By: Launce Macomber

Launce Macomber — Mon, 21 Dec 2009 18:42:28 +0000

The responses thus far have demonstrated that the return for work involved is barely worth the effort. .5% or so doesn’t make for a great incentive. On the other hand, as these foreign conflicts wind down (hopefully) and returning servicemen who have opted for civilian life start looking for affordable housing, the VA may well face the reality of needing to allow an increase in the fee structure to insure a responsive mortgage community.

By: Jan Mundt (Henriksen)

Jan Mundt (Henriksen) — Sun, 20 Dec 2009 07:12:13 +0000

A loan amount of $183,500 would have have approximately $2975 in charges which includes the 1% origination fee. This equates to 1.6%, which does not leave a lot left after the broker takes his percentage. It would be good if the VA would allow for at least and additional .5%. As far as approving a higher amount; I’d say not likely. The VA loan guarantee program is a benefit to our veterans. VA does not allow the veteran to pay the escrow fee, which is a 3rd party fee, I just don’t see them increasing the amount a loan originator can make.

By: Ken Ritter

Ken Ritter — Fri, 11 Dec 2009 00:33:17 +0000

I think that since the margins are so small that the VA should allow for a slightly higher percentage amount to be charged to the Veteran on line 1. With a loan amount of X and the fees being 595, 600 and 200 (1395), this makes the margin so skinny, about .5% for the broker, not much incentive for the broker to do these loans especially with all the work that must go into them.

By: richard martin

richard martin — Wed, 09 Dec 2009 20:45:57 +0000

If we take 200k loan charging 1% loan origination fee that would be $2000 minus processing, bank and office fees approx.$1000 leaves about .5% for the broker, not a lot and not very attractive for brokers at this point. Note: I work with marketing and promotion so my estimate may be off the mark but lets see.

By: Teresa Gallaher

Teresa Gallaher — Fri, 04 Dec 2009 21:08:41 +0000

Well, If the average loan amount is 250K, the broker would be able to charge 2500 max according to the VA. Does that have to include any processing fee as well. If so, we would normally charge 595 processes and the lender usually will charge an underwriting fee of about 600 and fax/misc fees of about 200.
2500-595-600-200= 1105.00 this equals .4 percent, less than one half a percent.
If I did this correctly, I would hope the VA would make the change or else many lenders will not offer the VA product due to the slim margins and the possibility of actually lossing money.