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Yearly Archives: 2010

Jim Owens
By Jim Owens 27th March 2014 0 Comments

The Importance of Interest Rates in VA Loans

Common sense seems to imply that the purchase price for a home may be the biggest determining factor in whether or not you can afford it. However, there is another important element to consider, and it’s one that can have a significant impact on your bank account. Drumroll, please…it’s the interest rate! Let’s take a closer look at the impact interest rates can have on your finances.

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Each day, in fact each second, can reveal changes to the interest rate for a home loan. Lenders try not to change the rates that often, but they are actually constantly changing. That means the timing of your home purchase determines a lot about the interest rate you will get. If rates are generally around 5%, you’ll pay about 5%. If you buy at a different time, when rates are near 3.5%, you’ll likely get a rate in that general area and save quite a bit on your mortgage payment each month.

Rate Effect

Let’s say you have about $2,500 per month that you feel comfortable using to pay your mortgage:

  • At a 4.00% interest rate, $2,500/month will buy a $465,500 home.

  • If the rate is at 5.00%, $2,500/month will buy a $410,000 home.

Wow! That rate increase of 1.00% reduced your purchasing power by over $50,000.

If you still want to buy that $465,500 home at the 5% interest rate, your mortgage would be approximately $2,782/month. That’s almost $300.00 more per month than the 4% rate!

Therefore, we can see that a rate increase of 1.00% can have a drastic effect on affordability.

Price Effect

Let’s now say that you bought that $465,000 home at a 5% decrease in price – that would equal a purchase price of $442,225.

  • At the current 4.00% interest rate, you would pay about $2,387/month.
  • However, if the interest rate increased to 5.00%, that reduced purchased price would cost you about $2,655/month.

As you can see, even with a reduced price, an increased rate can lead to much higher monthly payments.

Assuming: VA Fixed Rate 30 Year mortgage with 100% Financing, 2.15% Funding Fee, and $230 monthly Tax & Insurance

What’s expected to happen to both interest rates and home prices?

Right now, short term “Fed Funds” rates, set by the Federal Reserve, are already at 0.00%, so they can’t go lower.  The Fed is currently buying a large volume of mortgages daily to help keep those rates down too.  However, they have announced that they will be cutting back on the buying of mortgages, which will likely increase mortgage rates over the long run.

What is the general home price consensus for the future?

According to the following excerpts from a Honolulu Magazine July 2013 article about Hawaii real estate trends, supply and demand has fueled the current rise in median sale prices, and Hawaii home buying is an opportunity to seize upon:

  1. In the past year alone, the median sales price has gone up 4.2 percent for single family homes and 5 percent for condos. Not a bad investment strategy, especially when the economy as a whole has seen its share of ups and downs.
  2. According to the Honolulu Board of Realtors, the current median price for a single-family home in Honolulu is $625,000 (a condo is $335,000). Economist Paul Brewbaker says don’t be surprised if that number morphs into $1 million before the decade is over.
  3. Basically, all that ever-growing numbers of home buyers can do now is try to grab an existing home when someone decides to sell. So far this year, we’ve seen an average of 356 single-family homes and 521 condos come up for sale each month, a drop of 27.2 percent in inventory of single family homes, and 21.4 percent in condo inventory from 10 years ago.
  4. If prices are consistently on the rise, and seller is king, where does that leave you if you’re trying to buy? Not in a bad place, actually, if you act quickly. “This is actually a good time for buyers as well,” Gregson says. “The inventory may be low, which is nudging prices upward, but interest rates are also low, which works in the buyer’s interest.”
  5. “Things aren’t going to get more affordable in Hawaii,” says Miyama who advises getting a foot in the door. “Start somewhere and build a financial foundation, build equity.”

For more information regarding your VA loan benefits, contact us or fill out our online application and we’ll be sure to get in touch with you.

Brenda Carr
By Brenda Carr 22nd March 2014 0 Comments

BAH Breakdown: What Can Your Housing Allowance Buy?

Aloha, military service members! Here at Hawaii VA Loans, one of our goals is to be your go-to, trustworthy resource for information on home buying and the VA loan process. In order for us to achieve that, we think it is important to break it down for you. Not in dance moves, but in data, BAH style. We’ll leave the break dancing to you – for after you sign those closing papers.

What can your BAH buy?

When the views of a home for sale are described as “Coastline, Diamond Head, Garden, Golf Course, Mountain, Ocean, and Sunrise,” there’s no doubt that you’ve found something special. This Wai Kalo’i home in Makakilo hillside brings all of those views…and more.

Located in Kapolei, a growing, vibrant city well-known for many family and sporting attractions like the Ko Olina Resort and the Disney Aulani Resort, this home is in close proximity to U.S. Coast Guard Air Station Barber’s Point. The commute to either Schofield Barracks and Joint Base Pearl Harbor-Hickam would take approximately thirty minutes, making the community of Kapolei a great location for many active duty service members stationed on Oahu.


The BAH Breakdown

Where: 92-1479 Makakilo Drive, Kapolei, HI 96707

Bases nearby: U.S. Coast Guard Air Station Barber’s Point – 8 miles; Schofield Barracks – 16 miles; Joint Base Pearl Harbor/Hickam – 18.7 miles

Property type: Detached Single Family

Asking price: $644,750

Bedrooms: 4

Bathrooms: 2.5

Square footage: 1,721

Schools: Barber’s Point Elementary School, Kapolei Middle School, Kapolei High School

Rates

  • Interest rate: 4.125%
  • APR: 4.333%

Payments

  • Principal and Interest (includes VA funding fee of 2.15%) = $3,191.96
  • Insurance = $125
  • Property Tax = $156
  • HOA Fee = $86

Total estimated monthly payment = $3,558.96

The new 2014 BAH Rates support the ability for many active duty ranks to afford this property.  For E-9, W-3 to W-5, O-3E, and O-3 and above, this property will be covered by your Base Allowance for Housing. The BAH rates for ranks of E-8 and O-2E fall just under this property’s total monthly payment, and could still be affordable.

Do you like what you see? For more information on a property like this one, contact Kahala Associates, Inc. at (808) 735-7500.

Would you like to find out if you qualify for this purchase price? Fill out this online application or contact VA Loan Specialist, Brenda Carr at (808) 792-4247.

Erin Delgado
By Erin Delgado 20th March 2014 0 Comments

Hawaii VA Loans March Ambassador: Kyle Millerd

It’s apparent upon first meeting LTJG Kyle Millerd, that he must be involved in some type of athletic pursuit suitable for a man of his 6’5” stature. Is it basketball? No. Football? No. Baseball? Not anymore. Rugby? Score!

A 2010 graduate of the U.S. Naval Academy in Annapolis, Maryland, Kyle began playing rugby after three years as a pitcher for the Midshipmen baseball team. He immediately discovered success in the full contact, high speed sport, and a dedication to the game that would take him from starting on the Naval Academy team to now being a member of the All-Navy Rugby team. The 2016 Summer Olympics in Rio De Janeiro will see the addition of Rugby to the Games, and Kyle is working toward a spot on the U.S. National Team.

As a Navy P-3 Pilot stationed at Kaneohe Marine Corps Base, Kyle’s commitment to his country is at the forefront of his goals as well. These two devotions are why we are proud to name LTJG Kyle Millerd as our Hawaii VA Loans March 2014 Ambassador, and share his Navy Rugby story with you.

Q&A with Kyle Millerd

Where are you from originally?

I’m originally from San Clemente, California.

What kind of sports were you involved in growing up?

I was big into baseball. My goal was to play professionally. My dad was a football player, but I ended up branching off into baseball and basketball. Then I was recruited by the Naval Academy to play baseball.

Who were your athletic influences?

My dad for sure. He was a top prospect in football as a quarterback and then in baseball as a pitcher. He’s a phenomenal athlete all around. His devotion, energy, and time spent coaching me growing up has translated over to me.

What was your baseball experience like at the Naval Academy?

I played for three years as a pitcher. I had success my freshman year. Towards my sophomore year, they tried to make me a starter, but mentally, I wasn’t there. I didn’t have the greatest season. Junior year came around, and I didn’t have that great of a season then either. That’s when I decided to switch it up. Initially, I was going to box and started training for that. My roommate was playing rugby and mentioned it to me, and then the rugby coach came up to me and asked, “Are you done hitting baseballs? Do you want to start hitting bodies?” I started laughing and said, “I might actually take you up on that.”

So I went out on a limb, because I had no experience with contact – with running and proper hitting – outside of backyard contact sports with my friends. I put on some weight and next thing I know, I’m starting for the Naval Academy team. I kind of realized I should have played more contact sports growing up.

What was it like being an athlete and also managing the academic rigors of the Academy?

The Academy has a high expectation for standards with academics, so I when I got there, I really had to learn how to study and time manage. On top of that, I would be at baseball into the evening, then go eat dinner, and the last thing you would want to do was homework – it was all about having that extra push. It was definitely a unique dynamic and you have to make sure you’re on top of your game when you’re there.

Explain to me how the sport of Rugby has progressed for you since the Academy.

I started playing fifteens and they just kind of threw me out there against Ohio State in the first match of the season. I didn’t know half the rules, but ended up doing well, and each match I played, I just kept progressing.

In 2010, they had the Collegiate Rugby Sevens tournament where the top colleges play, and they had just announced the implementation of Rugby 7s into the 2016 Olympics in Rio De Jeneiro. That tournament was a whole recruiting process to get top notch players from college into the U.S. National program. I was a forward and I remember we lined up and we were doing sprints, and I was beating the fastest guys on the team. I started on the sevens team for that, but I ended up partially tearing my hamstring the day before we left for the tournament. At the time, the head coach for USA was looking to recruit me and I couldn’t play. It was very unfortunate, but everyone said, “Get back on your hamstring and keep playing. If you progress, you could eventually get in the U.S. National program.” That’s where I’m at now; I’m on the radar screen for Team USA and I’m in the process of potentially being picked up for the WCAP (World-Class Athlete Program).

What teams are you currently playing for?

I play for All-Navy Rugby and we play against the All-Army, All-Air Force, etc. I also play with Combined Service Rugby. Right now, they just formed All-Military Sevens. I just played with them and those are the top players out of the entire military getting looked at by USA. I’ll also probably play for a local club called the Hawaii Harlequins to prepare for tournaments coming up.

What are some similarities between rugby and serving in the military?

It translates right over. It’s a feeling of brotherhood. You go through situations where you don’t know if you’re going to come out on top, but if you keep a strong mindset through it, you end up succeeding together. That’s the whole point of rugby entirely, communication is the most imperative thing, especially in sevens. That communication translates over to being a leader in the squadron and in the cockpit – effective communication and just making sure everyone is on the same page.

What’s your physical training like to keep up with such a fast paced game?

In sevens rugby, you don’t have a lot of rest rate, and you’re at such a high intensity level that your body has to get used to that, so I have to taper my workouts for that. High intensity training, sprinting, lifting heavier weights, and intervals – that’s where I focus my efforts on.

What are your short term and long term goals with rugby?

Ultimately my goal is to get in the program for the USA on the military side, developing, and making a run for the National team and the Olympic team. Beyond that, continuing to play in the military in major tournaments. We’re traveling to New Zealand soon. There are really cool, unique opportunities to play. I’d like to play as much as I can now while I’m young and healthy. Eventually, I’d like to start coaching.

How do you see rugby developing as a sport here in the U.S.?

It’s definitely growing. There are youth programs all over the country. I think after the Olympics, that will open America’s eyes to how cool the sport is. It already has though, they televise rugby matches all the time. It has a great potential to become one of the top sports here. I just think it needs a pushing power behind it.

What should a young person know about getting into the sport?

The earlier the better. The younger you are and the earlier you learn something, the better you’re going to be at it skill wise later on. It’s the one sport that raw athletes from all other sports can pick up pretty quick, but the skills and the field vision are the things that people lack. The athlete who has been playing since a little kid is going to see more, because he knows where to place the ball, he knows exactly where the ball needs to go, he knows where the defense is, he just has that much more experience. I started late and I picked it up, and it was dedication and yearning to learn. It’s such a unique sport and I wanted to keep understanding and picking up more and more things.

What are some things about the game that you love?

The brotherhood and camaraderie. Going out and giving 150% and leaving it all on the field. Then, after the tournament, having a couple of beers with your best friends. Rugby in general is such a family oriented sport. You go out and hit each other, but at the end of the day, everybody’s friends, especially in the military rugby community.

What sport wins if you have the choice to watch either baseball, rugby, or football?

Honestly, I would say sevens rugby – if you watch an international level tournament, it’s action packed. It’s tough though, it’s a coin toss. I love all sports equally.

How do you like being stationed in Hawaii?

It’s unreal. It’s like a dream. I love being in the ocean and being outdoors. You can’t beat it.

What are some of your favorite things to do here?

Surf, swim, dive, and just being on the beach and hanging out. It’s so cool being a pilot and cruising around Hawaii and seeing how beautiful everything is. I love surfing, and just being out in the elements…I would have loved to have been a pro-surfer, but I’m too damn big.

Mahalo to Kyle Millerd for taking the time to sit down with us. Best of luck in flying, rugby, and surfing! We believe that the dedication, devotion, and determination that Kyle demonstrates are values that are found throughout the military and veteran community, and are what make our service members the best. We look forward to bringing you news on his future rugby tournaments!

Photos by Keao Sunaoka

Erin Delgado
By Erin Delgado 1st March 2014 0 Comments

Breaking News: Honolulu County VA Loan Limit Increases

The Hawaii VA Loans team is thrilled to share the following great, breaking news with our military and veteran community: from the VA Central Office in Washington D.C., the 2014 VA Loan Limit for Honolulu County has been increased to $721,050!

As we previously reported, the 2014 VA Loan Limits that were announced in December had Honolulu County’s limit set at a shocking $625,500. This new $96,050 increase is a welcome and necessary change for our Hawaii service members and veterans seeking to become VA homebuyers in Oahu’s real estate market. Here at Hawaii VA Loans, we will continue to keep you up to date on the latest VA news as soon as it happens.

The 2014 VA Loan Limits for neighboring islands are:

Kauai = $713,000

Maui, Lanai, Molokai = $657,800

Hawaii Island = $625,500

For more information regarding your VA loan benefits, contact us or fill out our online application and we’ll be sure to get in touch with you.

Erin Delgado
By Erin Delgado 24th February 2014 0 Comments

Big News for Big Island VA Homebuyers

On February 19, 2014, The United States Department of Veteran Affairs announced that veterans will now be able to use their VA home loan benefits for buying or refinancing existing loans on properties with rain catchment systems.

Prior to this change in policy, veterans on Hawai’i Island could not consider homes with catchment systems for VA loan purchasing due to water quality standards not meeting VA loan approval. The Hawai’i Department of Health policy had declared catchment systems “not safe for domestic uses.” Since most of the properties without municipal water are found on the Big Island, the policy was a home purchasing roadblock for veterans.

Now, the Department of Health has determined that catchment systems can be made safe for domestic use, and the VA will begin processing home loans for catchment system properties as long as the guidelines for water quality standards are met.

US Representative, Tulsi Gabbard, who worked with the Department of Health to change the VA policy, expressed her pleasure with the outcome: “I commend the efforts of the Hawaiʻi Department of Health and the VA for coming to a resolution that provides a straightforward approval process and resuming the home loan guaranty program for our veterans and their families.”

The new policy is effective until January 1, 2016.

For more information regarding your VA loan benefits, contact us or fill out our online application and we’ll be sure to get in touch with you.

Erin Delgado
By Erin Delgado 21st February 2014 0 Comments

Announcing the Free Hawaii VA Loans 2014 Homebuyers’ Guide

All of us at Hawaii VA Loans are excited to announce the publication of our 2014 Homebuyers’ Guide available for free download right now!

Within its pages, you will discover the benefits of homeownership, and the steps you need to take to use your VA Loan to become a happy Hawaii homeowner. The 2014 Homebuyers’ Guide has everything you need to know about making your dream of homeownership a reality, including information about eligibility requirements, current VA Loan limits, and the homebuying process.

Since 2008, we have been publishing our helpful annual guide so that you – our service members and veterans – have the most up-to-date and thorough VA Loan information at your fingertips. We want to make sure that you are “in the know” and can access these details easily from wherever you may be, whether that’s in Hawaii, on the mainland, or on deployment.

We hope you find this useful guide valuable to your home purchasing endeavors. Thank you for your service, and please don’t hesitate to contact us with any questions you may have. Don’t forget that you can download the Hawaii VA Loans 2014 Homebuyers’ Guide for free, HERE.