Questions Regarding "Financing Considered"?

Question

Hello Everyone!

My husband and I are heading out this weekend to purchase our second SFH, this time in Las Vegas, NV.

Naturally, as two people who are still very new and green to buying/selling properties, we're working with a realtor. She has set us up with a link to the MLS in the area with properties that meet our specifications, so we can look while we're still out of state.

We're going to use my husband's VA loan because mine is still tied up with our original home, so we can take advantage of that sweet, sweet 0% down/No PMI benefits.

My question stems from the fact that a lot of listings have various types of financing listed under "financing considered". Some of them just simply say "Cash", while others will list "cash/FHA/Conventional/VA", or a mixture, or whatever.

My question is: What would be the reasons behind limiting a potential buyer's financing methods? Is one better than the other for the seller? Do they think their property will not pass a VA/FHA inspection? I can see why cash would be the most lucrative for a seller, but don't they end up with the money in their pockets regardless? For the ones that do not explicitly say that they will accept VA financing, should I just delete those listings, despite some of them being really nice? Or is this something that can be negotiated later?

Thanks for reading! I get a bit wordy sometimes!

Phillip Dwyer · Answer

Account Closed Congrats on finding a place.  I apologize as well.  I had assumed from the first post that you were purchasing a rental property.  That said, I do like your strategy of buying at each base you've moved to during your active military time.  When you get settled come check out some of the local real estate groups.

Phillip Dwyer · Answer

Account Closed  There are other considerations as well.  If the house is a flip, FHA and VA have waiting period restrictions on those.  VA has costs incurred by the seller that conventional loans do not.  There may also be tenants in place, so FHA and VA financing won't work for that.

If you're buying an investment property, you can't use your VA loan anyway.

Patsy Waldron · Answer

Some types of loans take longer to process than others, and some have more stringent critera for underwriting. For example, a USDA loan at one time was taking 6 weeks for USDA to review. That is in addition to the upfront period of inspection, appraisal, etc, required by the bank. Some sellers may not want or be able to (due to moving, buying another property, etc.) wait that long.

An FHA inspection is notorious for being stricter about the condition of the home than conventional. when I sold my primary home to an FHA buyer a few years ago, I had to fix a small section of rotting wood in the frame of the garage door at a cost of several hundred dollars- because you can't just fix a few inches, you have to replace the whole side! This would likely not have been an issue with a conventional loan.

If a home has undergone an FHA inspection, that report stands for 6 months, so the seller can't just say "Oh well, next!"- because if the next buyer also has an FHA loan, the same repairs will be expected. So some only go for conventional or whatever.

All that to say... If VA is not included in the list of financing options, it is likely they are not considering offers with VA financing. You can always have your agent ask the listing agent, though- if the property has been on the market for a while, the sellers may be willing to consider your offer.

Jennifer Lee · Answer

that's interesting, we don't have that on our MLS.  BUT I do see

*CASH BUYERS only: that is usually distressed, it will probably not qualify financing

*No FHA: Means it probably will not pass FHA inspection, or had FAILED

*FHA ok: means they went through the inspection and passed, but deal fell through, OR agent thinks it will pass FHA

Upen Patel · Answer

Account Closed My apologies. Based on your 1st line "My husband and I are heading out this weekend to purchase our second SFH, this time in Las Vegas, NV.", it sounded as though you were not going to live there.

Account Closed · Answer

Also, @Chris Mason, Nellis AFB is literally right in Las Vegas, NV. Sellers should absolutely be aware of potential VA loan clients.

Account Closed · Answer

To all of the people insinuating mortgage fraud: We have orders to Nellis AFB in Las Vegas, NV. We will be living in this property for at least 4 years.

We are not flippers or wholesalers or anything like that. We buy a house at each of the bases we're at, live in them for a few years while we're there, and rent them out when we leave.

There is nothing illegal about that.

I don't even know how that was even brought up as a potential issue? But I do know that I don't like being called a criminal, so thanks for that.

Account Closed · Answer

Thank you both for your replies! I was indeed wondering if perhaps the homes just have issues that the sellers know will not pass a VA inspection, and are unwilling to shell out funds for repairs. While it's unfortunate how the FHA or VA inspections work for the sellers, I guess it does protect the banks and buyers.

I just skimmed over the ones that did not offer VA financing. I figured that they wouldn't be considered on purpose.

But we have 40+ homes selected to view beginning Sunday, so this was more of a curiosity question than anything else.

I also didn't realize that different loans took different amounts of times to process! I guess it's because I only have experience with the one type. Definitely a good piece of information to have/consider when we retire from Active Duty to do this full time!

Robert Adams · Answer

I agree with Heather Nellis Air Force Base in the NE part of Vegas and we have a lot of VA buyers here so sellers should be aware of VA buyers.

Best of luck with your purchase and welcome to VEGAS!

Robert Adams · Answer

There are many reasons why they might not accept VA as listed in this post. Have your agent put VA in the MLS criteria and it will weed out all the non VA listings. Save yourself the time and headache of sorting through them.

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