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Questions that frequently arise after you have obtained your VA guaranteed loan.

• 1. I'm having trouble making my payments. What should I do? When it comes to payment problems, communication is very important. You need to contact your lender as soon as possible to let them know that a payment will be late, why it will be late and how you plan on rectifying the situation. You can also contact the VA, who may be able to help you arrange a repayment plan.
• 2. I've heard of VA refunding. What is it? "Refunding" is a term used when the VA purchases a loan from a private lender. It is a very rare occurrence. If, for reasons beyond your control, you missed some loan payments but were able to make them now or in the near future and your current lender wasn't willing to work with you, the VA could purchase your loan from the lender and you would pay the VA directly.
• 3. There are serious problems with the condition of the home I purchased. Didn't the VA inspect the property when performing the appraisal? It is true that an appraiser inspected your property prior to the funding of your VA loan; however, that appraisal was not meant to serve as a property inspection. The VA can not help you with problems related to the condition of your home. That is why all home buyers are advised to hire an independent property inspector prior to the purchase of a home.
• 4. I used my VA loan to purchase a brand new home and it was inspected by the VA during the construction process. However, there are serious issues with the home that the builder is not taking care of. Can you help? If the VA inspected your home during the construction process there is a complaint procedure that you can follow. This process is in place in an attempt to get the builder to address and correct any construction defects. If the VA finds that the complaints are legitimate, the VA can then request that the builder take actions to correct the issues. The VA can not force a builder to correct the problems if he or she chooses not to. The VA will, however, take administrative sanctions against builders that do not cooperate and can refuse to do business with those builders in the future. It is important to remember that any such complaints must be filed within 12 months of ownership of the home. If the builder does not comply with VA requests, you may opt to pursue civil litigation against the builder.
• 5. I don't agree with the escrow payments my lender is charging. Can you do anything about them? The VA does not regulate escrow payments. The only thing the VA mandates is that all lenders make sure that property taxes are paid and that there is insurance coverage on the property. While many lenders will use escrow accounts to see that these requirements are met, the VA does not control how these escrow accounts are managed. If you feel that you are being charged unfair amounts for escrow, you may want to consider contacting the US Department of Housing and Urban Development (HUD).
• 6. Is my VA loan eligible for refinance? It is possible to refinance a VA loan should the need arise. You will, however, have to meet the lender's requirements for refinance. For more information of refinancing your VA loan, contact a VA Loan Specialist at 808.792.4251.
• 7. How much does it cost to refinance a VA loan? Fees range between one-half of a percent to three percent depending on the specific circumstances of your VA loan.
• 8. Am I going to have a problem selling my property because I have a VA loan? The fact that you have a VA loan should have no impact on your ability to sell your home at any point in the future. The only time the VA would have any say in the sale of your home is if your buyer was assuming your VA loan and your original purchase of the home closed after March 1, 1988. In this case the VA would review the qualifications of the buyer to see if they met the lending requirements.
• 9. Am I automatically released from the responsibility of my VA loan if I sell my home to someone who assumes the existing loan? No you are not. If your loan was closed after March 1 of 1998 you must notify the lender or the VA so that they can approve your buyer. If your loan was closed before March 1 of 1998, you can have the buyer assume your loan without VA or lender approval. However, it is generally advised that you contact the VA for approval regardless of the date of your loan closing so you can receive a release of liability should the buyer default on his or her loan agreement.
• 10. If I obtain a release of liability, will the restoration of my entitlement be automatically granted to me? No, it won't. Your buyer will need to meet credit and income requirements and will also need to be a veteran with entitlement that can substitute the entitlement used by you when you obtained the original loan.
• 11. What is a VA compromise claim and how does it work? If you need to sell your home and are unable to get enough money from the sale to pay off the existing loan on the home and you have no other way to pay off the loan, the VA can issue a payment for the difference. This is called a VA compromise claim. When a VA compromise claim is issued, you will still be liable for the amount of money the VA paid on the claim, however, the compromise claim payment is usually much less than what you would have lost if the sale of your home had fallen through or if your property had been foreclosed on.
• 12. If I die before my loan is paid in full, will the VA pay off my mortgage? No, a VA guaranty is not a mortgage life insurance policy. If you want your mortgage to be paid off in the event of your death, you will need to purchase a mortgage life insurance policy. They are available from private insurance companies.

* Please note that applications involving anything other than an honorable discharge will require further processing by the VA to determine whether or not the service was under honorable conditions.