I'm In The Military. What Kind Of Loan Should I Get?
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- Опубліковано 27 лип 2019
- I'm In The Military. What Kind Of Loan Should I Get?
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I used my VA loan benefit to purchase my house in 2019, I had no down payment, significantly lower closing cost than a FHA or conventional loan, and I pay no mortgage insurance, not to mention I was able streamline into a lower rate (2.65%) in 2021, I would really be interested in hearing the figures that make the VA loan a more expensive option than a conventional mortgage.
Hey brother, anyway I could pick ur brain with a few questions about the VA loan process? I'm just starting off myself and it's a bit confusing on how to start. Do u have a way I can PM you?
The VA funding fee, which some lenders hide by rolling it into the loan.
It's the "funding fee" that kills you
If you’re even 10% service connected they waive fee. I paid no fees whatsoever to close on my house
I'm getting out of active duty in 12 months. Would like to DM you about your experience.
Dave could really use and updated video for military to reference that break down the fees that he mentions from the VA loan compared to his recommended loan direction. Not that I don't agree with Dave's teachings, but it is clearly something that can help more than hurt.
CyberShinobi there’s no fees with doing a VA loan. Other loans you always pay closing cost if not negotiated, and a percentage upfront for the house. I have two VA loans out now and never paid a dime!
Jermaine Boxchevy that’s incorrect there’s a VA funding fee for 1.75% of the loan amount that’s rolled into your loan amount
It’s not anything that costs u up front but will tally thousands on top of your principal . Take that with the fact you are likely not putting much if anything down when the market shifts you will be severely under water lol
I guess one benefit is no huge down payment required.
@@bangladeshirealtor no funding fee with disability above 10% I believe
@@ClaCus you are right, this is straight from the VA website:
You do not have to pay the fee if you are a:
Veteran receiving VA compensation for a service-connected disability, OR
Veteran who would be entitled to receive compensation for a service-connected disability if you did not receive retirement or active duty pay, OR
Surviving spouse of a Veteran who died in service or from a service-connected disability
Having been in the military for 9 years, I will say that if you are armed with knowledge, it is a great wealth-building tool. My little brother has joined the service as well, and he is making money moves at the age of 21, that I wish I had. I'm almost out of debt and live comfortably, but there's no reason you cannot save money in the military and build a strong financial cushion for your future.
Especially if you are single and live on base during your time in service.
Especially if you aren't an alcoholic or shopaholic or foodie. Really i think if anyone anywhere was taught about money they would make better decisions haha.
@@jenna8987 basic math
@@clarifyingquestions yeah..... that's why 80% of Americans live paycheck to paycheck.... I feel very blessed to be far from that position because I have educated myself. It's so much more than basic math.
@@jenna8987 yeah .... and that s why 80% of Americans are living pay cheque to pay cheque or worse living beyond their means. Dave answers every call with basic math! Starting with what is your household income etc. The question why people ignore the basic math is more complicated because of the human psychology involved.
Use that VA loan.
$0 down. Low interest rates. Buy a 4 unit, live in 1 rent the other 3. Then move. Dave is wrong on this one.
@@shootmovecommunicate3322 I got the best VA loan after my credit was fixed by creditpatchup. com. I was so proud of fixing my credit after many years of being active duty. I total recommend Mark Lazaro of Credit Patch Up
.
@@garyl.phillips7480 Well this totally doesn't sound like a fake ad.
@@RyanBreaker lol right
@@shootmovecommunicate3322 I believe it’s illegal to rent out a house on a va loan.
VA loan without a doubt. SD area is booming for sure. Already getting equity at my home as it is.
We’ll get the thing rented out if we get stationed somewhere else, most likely to another servicemember because if they leave my property damaged or unsat, I know exactly where to go. Dave is right, people come and go in military towns. Make it an advantage to YOU.
Eddie Wow Just because your renters are military doesn’t mean you are protected. Seriously. I know a bunch of people who got burned who thought like you did.
You mind if I ask a few questions? I'm a vet so would qualify for the VA home loan. I'm not serving anymore but I'm curious your income and what the price is of a home that you bought. I might be moving to Santa Ana and it's home prices are super high like SD too
Sorry Ramsey but i think your wrong on the VA fees
He’s so wrong about this.
Some of the worst advice I’ve heard Dave give. My uncle did 20 years in the USMC. Granted he was an officer so his take home pay was substantially more than some junior enlisted guy but literally every place he got stationed he bought a house. When he left he started renting them out. If he was deployed or otherwise unavailable to correct tenant issues or fix things his wife was there to step in to run the business. When he retired at 20 years he had a real estate portfolio that included nearly a half a dozen paid off homes and a big income stream from all his renters. He was a multi millionaire before the age of 50. Good thing he didn’t listen to Dave.
Thanks Dave, you really opened my eyes to some questions and answers.
I have to disagree with you on the Yuma area. This is a fast growing town, small military population. And the VA loan was the best choice, hands down lowest interest rates, no pmi.
VA loan looks good on the surface :(
Representing Yuma, AZ :-)
dave insight is spot on!
Great advice Dave, thank you!!
Im in in military. Buying a house is so freaking risky and difficult. People really don't know about all the BS that we have to go through sometimes...
Such as?
Dave: No loans...
Next caller
@ShootMoveCommunicate I got the best VA loan after my credit was fixed by creditpatchup. com. I was so proud of fixing my credit after many years of being active duty. I total recommend Mark Lazaro of Credit Patch Up
I swear Dave was talking about the Fort Hood, TX area. Lol I was stationed there and it took 3 of our neighbors more than 10+ mo this to sell their homes. The competition is too stiff and not most Soldiers want to buy vs rent.
Killeen sucks.
Excellent video!
How?
So don't use the VA loan, build 20% down payment and come back to buy the home when it's worth a lot more money and pay more? Got it.
Exactly. VA loan allows you to buy the home now, keep money in the bank (contrary to Dave, you need more than $1,000!). If you wait 2 years to save, the house is now $150k more. Well, even if you paid $150k, your proportionate “dent” in the down payment hasn’t changed. Meanwhile you haven’t built your savings.
Hello Dave, you have brought up the expense of the VA home loan a few times, would you please do a segment on using these benefits if you are a disabled veteran? I failed to find the direct messaging function here on UA-cam.
even better for you! Disabled Vet (receiving VA compensation) you are exempt from the VA Funding Fee. No additional expense for you EVER! All other costs associated with every other loan used to purchase a home apply. Negotiate up to 4% of Seller contributions to pay for your closing costs. Use it, You earned it!
I bought a house using a VA loan. Went from $1550 rent to a $1065 mortgage payment. Dave told me not to use a VA loan but I ignored him. Better off not listening to him this time.
I also think it would be interesting to see his thoughts are on the 25% rule of house purchase/income when your 100% and your house doesn’t have taxes to pay each month
Thank you so much for this info Dave. We are about to be in the same situation.
Use that VA loan. Dave is incorrect. Do research
Buying a house with the military housing allowance is tempting but don't know if I would trust a real estate agent when their job is to sell you a house. Trust but verify.
Realtors have a fiduciary duty to help buyers. Their financial interest is tied to yours and they are bound by legal obligations that others are not. Trust but verify, sure, but there isn't a lot they can usually do without getting their license yanked.
Trust but verify = distrust
It’s not a realtors job to watch out for you it is your job
@@MultiWhitney14 Your realtor's job is literally to look out for you. It is still in your interest to do due diligence, because it is significantly easier to fire a realtor than hold one accountable.
Hello Dave, thank you for what you do....similar question to this caller. Would you recommend this caller to use a VA loan IF they qualify for the disability criteria????
If you don’t plan to put 20% down yes because PMI is expensive and no funding fee... I know I’m not Dave. I’m just a vet, trying to help another vet
I understand Dave’s 7 baby steps philosophy and how he is totally against financing anything, except a house using a 15 yr conventional mortgage with at least 10% down. If you are receiving VA disability compensation and the VA funding fee (~2.3%) is waived, why is it a bad thing to take advantage of the VA home loan?
It's great to hear Dave's consistent messaging of buying houses only when you can sell them for a profit.
*Holds phone up to forehead
"None."
To the vets, if you're disabled at a certain percentage, you should look into a va loan. As a disabled vet, you do not have to pay a va funding fee. This fee is why Dave doesn't recommend va home loans. Another benefit with a va home loan is that you can refinance later for an irrrl (interest rate reduction refinance loan). Right now, it's possible for vets to get an irrrl at 3.3% or less. Pretty good time to look into it.
I only ask because you seem to know a bit about this but wife is military I'm disabled veteran and our house is paid off would it be a good idea to buy our next home on a va loan before we sell the paid for home?
He also doesnt recommend it because it allows you to finance a house 100%. This means you'll end up paying way more in interest over the life of the loan
Ngl I'm 18 planning on enlisting in a year and I'm overwhelmed.
What are these fees and “gotcha” things that he’s talking about? I have been some nice equity using a VA loan.
I think he’s talking about a funding fee. But if your even 10% disabled you don’t pay it. With that said, I’ve never met a vet that couldn’t claim something getting out... seems like we are all broken lol
VA Home Loan Funding Fee
Thank you Dad, I mean Dave! 😁 So glad this video came out! Just bought this PCS in Hawaii kept wondering if you'd approve 😬 and I got the answer 😅 all our expenses are within our BAH rate and if all goes according to history $$++
Buy a wedge deal and fix it up so you have equity going in the home.!!!come onn!!!
What my military parents did was buy a house in a mid size town and the focus was on the kids' education and a job for my mom so that we could have a good life. But that did mean that my parents lived separately. But such is life.
Real estate investors would say VA loan but I already knew what Dave would say 👎
Dave I'm a disabled veteran who recently just exited the military November 2019. Why is it that a Company that shares your endorsement is overcharging in lending fees me and lying about where that money is going?
I'm speaking on Churchill Mortgage of Franklin, TN. I'm not a disgruntled person just someone that thinks it's wrong for a company you endorse to charge 1.5% origination fees, state that this is required by the state of TN and that the funds go directly to the nonprofit THDA 2nd mortgage when coupled with VA loan.
I understand lenders are independent and allowed to set their own fees, upto 2% for THDA, but when someone who has been working for 25 years like Michael Brown either doesn't know where money is going or more likely is inclined to be deceiving clients for their company I believe disabled veterans like me should be informed correctly.
I am using my real name for good reasons. I dont think I should hide anything. I learned a lot from your classes and books and if you taught me 1 thing it's to investigate and seek what's best for my family. I also want to protect my fellow veterans as should you.
Cause Dave is a con-man.
You need to get a VA loan...no money down no origination fees no funding fee cause you're a disabled vet...they also have reconstruction loans. A lot of protection you get your earnest money back if you back out during process...and the appraisal...
@ChristopherLago - BOOM! Do you still need some direction? I saw this video and the same put out by Chris Hogan (Ramsey Network) say that the VA is one of the 4 WORST LOANS on the PLANET! I had to do a video on this and will be out tomorrow!
Dave Ramsey on VA loans is like Jim Kramer on buying stocks.
Definitely have to disagree with Dave. I bought a house in 2019 with a VA loan (3.9% APR). After 6 on-time payments, I qualified for refinancing with the IRRRL program (2.3% APR).. greatest move I ever made 👍🏼. I was in the National Guard Army.. so I dont get stationed in a base full time.. i get to come back home and relax.. since we only work 1 weekend a month for National Guard.
Representing Yuma, AZ and MCAS!
Garbage place to be
5:56 Dave gangster life u kno what I’m sayin
Enjoy putting down that 20% for a conventional loan.
@Frank L not weird, 2.25% for a home under about $510k is the VA rate. Non VA is around 2.8-3%
@Frank L For a 700+ credit score, under $510k the going rate is 2.25%. it goes up if the loan value goes over 510k in most but not all markets. But your disbelief is now further verification that I'm getting a good deal, so thanks for that!
@@jessieh.8443 look what up?
@Frank L lol ok no worries! Take care
Va loan 236k 2.6% Jacksonville Fl
How do you feel about the Acorn Investment App
Michelle Harris costs too much. Watch Graham Stephan’s video on it.
Ayyy, shout out to Yuma
Yup. I crapped out buying a house with a VA loan in a military town. People think they're riding high for being veterans, but it's a brief career with a pension just large enough to make you a risk for quitting your post military job, which means there won't be one.
So you'd better save all that you can on active duty or you'll go from some high tech avionics job, to the assistant manager of the Sears menswear section to feed the mortgage of your depreciating home in a military town.
The VA loan costs 2.5% of the purchase price and your realtor will steer you to Wells Fargo to add that cost onto your mortgage.
Rent a place as cheap as you can stand it and save the excess BAH. If it says VA in front of the benefit, there's three benificiaries in decreasing order of benefit. At the top, whatever industry association lobbied for the benefit, in the middle, the government employees who get jobs administering these benefits and you the veteran getting a pittance in comparison to the first two working towards a silly college degree. They had to add BAH onto the GI Bill because that's the only payoff. College is a joke now. They should just make it all coloring books and call it a day.
Dave is extremely incorrect here. There is a reason why a VA loan is the gold standard in the realty industry. 0 money down with no PMI. There are some fees that the VA uses to fund the opportunity for vets to keep using VA loans, yes. But the benefits outweigh the positives. It's extremely irresponsible and frankly unpatriotic for Dave to lie about the VA loan.
Agreed!
Dave is a conman that hates America!
Hello Dave
Can you please explain more about VA loans for disabled veterans.
There are certain fees disabled Vets are exempt from paying. It’s can be a great deal!
It’s simply no property taxes but you’re exempt from that with any home loan.
@@jermaineboxchevy8562 no property tax?!?! I know they don't have to pay the fee.
@@jermaineboxchevy8562 No PMI. Nobody is exempt from paying property taxes.
If you are a 100% disabled veteran property taxes are waived.
What and where are these fees for the VA loan?
There is a funding fee you pay to use the VA loan. Disabled vets and few other exceptions are made to avoid the fee. Right now if you do $0 down and it's your first time using the VA loan the fee is 2.15% of the cost of the home.
VA funding fee for non disabled veterans
Patrick Delva Not true, I just closed on my 1st house using the VA loan. I put 2k down as a binding agreement on a 200k home in Florida. Just got my 2k back.
@@fullbattlerattle2493 Do you have a disability rating?
Patrick Delva Negative, I’m currently active duty over seas. Where are you located?
As someone who has done hundreds of VA Loans for Veterans and is a Vet themselves (USMC) I can tell you that 99 times out of 100 it is more financially advantageous for you to use a VA Loan. Dave gives great advice, but this is a miss my friends. Don't be deceived by the guru-like advice from someone who is not licensed to consult.
Dave: Just pay cash dua everyone is doing it.
😂
Buying a house when you are in the military is dumb. It doesn't matter what the Realtor says. You are going to PCS every three or four years. Rent and save your money. If you can stay on the Base, even better.
jvolstad May I ask why you say staying on base is better? I thought people in the military get BAH - where you can keep the difference if you rent cheaper than how much you receive?
@@Liveloud4Him correct. Living outside of base you could rent a 1 bedroom studio for say 700 a month and that area may give 1600 a month in bah. Big savings
@@yourmanzach2307 Exactly what I'm doing now. I'm single with no children, so it's a lot easier for me and I understand this. A lot of military people with families try to live large. Most of them live in places that are so expensive that they are having to dig into their base pay to pay their rent and other bills. Just gotta know how to play the game.
Nah. If I could go back in time, I'd do what I did after I got out, which is house hack. If you're active, buy a multifamily unit, preferably a 4plex, or tri plex..duplex if you must. Point is to live for free while earning cash flow from your rentals. Basically, get a 4plex (yes you can get one with VA loan), live in one unit, rent out the other 3. If you studied and purchased correctly, your tenants will be covering your mortgage and expenses on the property. When you pcs, you'll rent the unit you were occupying and be collecting money every single month. Do this in every city you pcs to and by the time you're done, you'll have enough cash flow from all your properties to not really have to worry about money. Just go study up..
@@SoulfulDisko You get housing money when you're single? Sorry, I know nothing but I'm very interested in the military and how it works.
No loan is the best loan
Make sure you're not buying a house based on the fact that you think it'll go up in value. It could be likely but you never know 🤔
I’m in the military aswell. Recently married and thought about buying a house. Hawaii Appreciates well, but it’s also very expensive. Just couldn’t handle the thought of possibly being stuck with a $400k home loan and 80% of it still being owed after I leave.
SemperUdellis do it. Just bought a condo in Ewa beach this year
Housing prices are declining a little on Oahu lately. I’m not saying don’t do it just do your research prior if you do.
No type of loan because you shouldn't. Buy a house . If you're in the military you should rent . Yes you heard that right rent whereever you are in the US you get bah and you can probably rent for cheaper than you can buy us you save on closing costs buying and selling the house , property taxes home owners insurance and whatever repairs it may need . Put that savings into a index 500 fund and you will make more money in 15 years than buying that house and selling it 15 years later
Ok, I just cancelled my future plans 5 years from now. :/ but thanks
If you can't put more than 20% down never buy a house you will always be upside down.
I literally just bought a house with a VA home loan 😂😑🤦🏻♀️ lol oh well
Got into it for 4 grand period and bought it already got 3G equity in it and only been in it for 5 days
You mean your simp bought a house you are just along for the ride.
That is a great outcome! Good luck with that to continue. Wish you all the best. I am vlogging (daily vlogs) finance and stocks on my channel if you are interested in value content.
Lance Kaminsky- teacher investing Excuse me. How would you know that?
Professional Subscriber Congrats. I'm so proud of you! Awesome news!! God Bless you!
@@lslurpeek You must be in a bad mood today?🤷♂️
Bout to bust
I am a Navy vet. Did dave just say the VA loan is terrible ?
Arguably the best home loan ever for young people
@@creedbratton606 Thats what I figured
@@creedbratton606 it seems to be better if you have the money for a down payment and if you are disabled. But my old roommate had to pay a 10k VA fee and used no down payment. I feel like that is much more expensive even if you look at the lower rates. What am I missing? I am a disabled vet but I'm just looking into which loan is the best.
best loan period - guaranteed!
@@jenna8987 he didn't pay it - it was financed into the loan. VA is the best and if you receive ANY AMOUNT of VA compensation - even better for you! Disabled Vet (receiving VA compensation) you are exempt from the VA Funding Fee. No additional expense for you EVER! All other costs associated with every other loan used to purchase a home apply. Negotiate up to 4% of Seller contributions to pay for your closing costs. Use it, You earned it!
i'm an illegal immigrant- which free government homes should I go with?
I hear ICE has the best rates for illegals. You should give them a ring!
Dave Ramsey: Don't be a loser living in your mom's basement.
Also Dave Ramsey: 0 down VA loan bad. You should just save enough money to buy a house cash.
I like dave, but sometimes he does contradict himself.
Brett Davis How is that contradictory? You can rent and save for a down payment, no help from mommy required. We did and then paid our house off in 4 years.
All the people who told us we are „flushing money down the toilet“ by renting still have one to two decades of mortgage payments ahead. Patience pays.
Also, if the funding fee is rolled into the loan and Yuma is moving in 3 years, is he even paying for the full funding fee?
My old roommate bought a house and didn't even know he would be slapped with a 10k VA fee on a 230k house. He didn't know about the fee at all. Anything government run suuuuuucckkksssss.
Sounds like he didn’t do his homework.
WOW! Bad advice
Chris Webb I like Dave but I don’t agree with him. Conventional loans gave a much higher interest rate and yes there is a funding fee but if you give 10% down the fee is 1.4%. When you compare a conventional loan of 3.3% interest rate or higher to a VA loan of 2.75% - it doesn’t not make sense saying the conventional is better. It really just depends on the rates and the persons financial position.
VA loans are super expensive on closing costs. 2.5% minimum...it's ridiculous . They restrict sellers on paying for cc as well.
That's 100% not true. I invest in real estate, I also use VA loan as I am a veteran. I just closed on a 4plex, had seller pay 100% of the closing, 1 year home warranty, 1 year home insurance, and had him fix about $7k worth of stuff on the property.
Also don't forget that disabled Vets don't deal with most of the downsides of a VA loan
@@JoshAllen702 that's what's up so how did you do it?
@@7LilTish9 it wasn't me really, my agent is a great negotiator. She got me all those concessions.
JoshAllen702 I agree seller paid closing costs and rate is lower than conventional
BS
Buying vs. renting in the military is a little more simple than that. It is an absolute certainty what rent will cost you over the life of your orders to an assignment. For example, if I rented at my current assignment, I'd have already spent $49,000 on rent and any landlord worth his salt would raise it this year. Even if I took a $6,000 loss (random example number) on my house all said and done with fees I'd come out $43,000 ahead today when comparing the two scenarios. My home has appreciated a decent amount, and I've got 15 months left. That's another $26,250 in rent I'd be staring in the face as well as a missed opportunity to use my pay to build equity in a home vs dump into rent if I hadn't bought when I PCS'd here. $75,000 in rent for the comfort of not losing a few thousand on a home sale is nothing to take lightly. The reality is that if you buy a reasonably priced home that would be enticing for others to rent when you leave, you can build wealth and a portfolio along the way. The key is planning and setting yourself up to have a downpayment ready to go when your next PCS comes around. If an average military person resisted lifestyle creep and paid an extra payment once in a while, they could buy and sell homes assuming zero appreciation over a 20 year career and retire with a check-of-the-month club membership and a nearly paid off home.
Awesome info, I just bought a house after pcs and still a bit scared over my decision. But im excited to have my own property and im focused on remodeling for prospecting renters.
I was literally just thinking about this!! I will be debt free soon and have like 9 years left to retirement. I seriously thought VA Loans were the ONLY way to go in the military...
Here's the way to beat the fees from the VA loans. Get yourself a real estate agent that will give you half their commission (yes, these agents do exist) if you do business with them. That should cover ALL of your closing fees and leave you a few thousand to play with. That's what we did and we had $5K+ left over once everything was said and done. Good luck
@@jkb6963 Thank you!! I'm definitely gonna look into that!!
@@jkb6963 well that's definitely something to look into
Second!
1st
Bad advice