Whether you've yet to close your first VA loan, or you're a seasoned military friendly agent, there's always something new to learn.
We all benefit from helpful guidance and advice from our peers and those who've advanced in the field. Today, I want to introduce you to Cory Kammerdiener, a Navy veteran and Realtor. After Cory left the service he embraced a new career in new home sales as a Royce Builders New Home Internet Sales Consultant, which allowed him to sell in 32 communities throughout the Houston metropolitan area. I recently sat down with Cory to discuss new construction real estate opportunities with clients using their VA home loan benefit.
With home builder sales experience under his belt and the drive and determination from his time in the military, Cory eventually became a licensed real estate agent, leading him to open Newhomeprograms.com LLC, a Real Estate Brokerage Corporation. Today Newhomeprograms.com consist of 34 real agents in four cities who have a dedication to working with first-time buyers, first time sellers and military veterans.
Here's some advice from Cory about working with builders when your client is using the VA home loan benefit:
How has your background helped with your current real estate business?
From a home builder new home sales background, I understand that real estate sales is a career not a hobby. Home builders require that you work every weekend and even when you have a day off you'll normally have to go in to make sure you keep the builder's clients happy. This business ethic and mentality is what allowed me to go in to general real estate and close homes every month for five years straight. My military background was very helpful because I was trained to pay attention to details, which is very important when dealing with any real estate transaction. My military recruiting background with the U.S. Navy is where I picked up my awesome sales skills, which allow me to work with all types of personalities and equipped me to be a good communicator.
Because I also used my VA home loan benefit, I understand the VA home loan is a unique loan and there's a lot of misinformation floating around, especially in the veteran buyer's mind. For example, most military buyers believe the VA is the one who's issuing the mortgage. This is not the case. The VA only guarantees the loan for a certain amount, but it's the mortgage lender who issues the loan. Each lender has to follow the VA guidelines as well as adding their own overlays or guidelines to the loan process. When I was in the military, I never knew what VA required so I was never prepared to obtain a VA loan. It wasn't until after I left the military that a mortgage broker explained the VA loan process and helped me get qualified.
I understand you've worked with numerous VA buyers who've purchased new homes. What do agents need to know when working with VA buyers pursuing new construction?
The first thing they need to know is the Department of Veterans Affairs has the buyer's best interest at heart. The VA appraisal process is tougher than FHA and conventional because the VA wants the best home at the best price for the veteran. The issues we're having in the states we operate is that VA appraisals are coming back lower than the negotiated contract price. This typically results in the builder reducing the price of the home to meet the VA appraisal's demand. This is actually a good thing because the veteran gets the home at a better price.
It's important to note here that not all VA appraisals come in low. The VA appraiser uses the sales comparison approach to value and looks for comparables sold within the last 6 months. If you're working with a VA buyer who receives a low appraisal, you can submit a reconsideration of value.
Something I believe the agent needs to do before bringing out their veteran buyer to a builder community is to call ahead and ask the builder if they offer any incentive for veterans who purchase in their community. A lot of builders do offer incentives like closing cost concessions, free upgrades and even discounts. If you don’t ask, your buyer may not receive these benefits.
What do builders need to know about VA buyers?
The first thing they need to know from a financial profitability viewpoint is that most active duty veterans will have great credit and minimal debt, which means they are great buyers! They're more responsible citizens and this is something that builders should appreciate in their communities. Military veterans love living around other veterans because it builds a sense of comradery. So a home builder will see an increase of veteran buyers in their communities. The other thing is military veterans are not as emotionally attached to homes due to their nature of relocating during their service in the military. The benefit here is that they don’t nitpick too much when building a home and they're rarely stressed out about the homebuying process. Fighting wars is a reason for stress, not purchasing a home. The point is, they're easier buyers to work with and home builders do appreciate this.
Builders have the opportunity to work with VA buyers with disabilities to construct adaptive housing to meet their needs. What advice do you have for builders who want to start working with the Specially Adapted Housing program?
Most builders we work with, the larger ones, already have priced out packages or modifications based on ADA guidelines. These modifications include rails in the bathrooms, wheelchair ramps, doors with lowered door knobs, etc. Custom builders for sure will adapt to the needs of a disabled veteran, but production home builders are also willing to accommodate. In Houston, KB homes are already built to certain ADA standards, like wide hallways, doorways and wheelchair-accessible stairs. My father is a disabled veteran, and I know that the VA installed a ramp to his front door. This is something we as Realtors can advise our disabled veterans to do, inquire about special housing modification programs offered through the VA.
To hear from more from Cory and our other expert agent panelists discuss what you need to know about new construction and VA loans, join us for our Tips From Top Agents Hangout on Aug. 22 at 1p.m. ET. Watch live or watch later, just click on the YouTube link above.
VA loans allow Veterans to have a co-borrower on the loan. Here we break down co-borrower requirements and provide common scenarios around co-borrowing and joint VA loans.
Your Certificate of Eligibility (COE) verifies you meet the military service requirements for a VA loan. However, not everyone knows there are multiple ways to obtain your COE – some easier than others.