Joe Homs, a real estate broker with over 50 years of experience, explains how VA mortgages work and whether they can be assumed by buyers. VA loans are assumable with lender and VA approval, and assuming a low-rate VA loan can be a major advantage. He walks through a real example of a civilian buyer in Temecula who assumed a VA loan.
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Hi there, I'm Joe Homs, real estate broker, mentor, and investor with over 50 years of experience. Today we're digging into a hot topic. Are VA mortgages assumable? With interest rates rising, more and more people are asking about assumable loans, and VA loans might just be one of the best opportunities out there. So whether you're buying, selling, just exploring options, this is one you'll want to understand. Let's break it down. What is an assumable mortgage? First things first, what does it mean when the loan is assumable? It means a buyer can step in and take over the seller's existing mortgage. Same interest rate, same terms, same monthly payment. And right now that could be a game changer because if the seller locked in a 2.75% rate back in 2021 and today's rates are over 7%, well, that's a huge difference in affordability. Now, most conventional loans aren't assumable. They're locked up in legal language and due-on-sale clauses. But VA loans, that's a different story. So are VA loans assumable? Yes, they are. And not just for veterans. Even if you're not a veteran, you may be able to assume a VA loan as long as the lender and the VA approve it. Now, it's not automatic. There's an application, credit check, And some paperwork. But if you can qualify, you get the same low rate the seller has. That could mean saving hundreds of dollars a month. That's real money. But there's a catch. Let's talk about the fine print because there's always a catch. The seller's VA entitlement stays tied up with the loan unless the buyer is also VA eligible. So if a non-veteran buyer assumes a loan, the seller can't use their VA benefit again until that loan is paid off or refinanced. That's something every VA seller needs to understand. And remember, the buyer still has to qualify. The lender wants to know they can repay the loan. So this isn't a loophole. It's just a smart, underused strategy. Let me give you a real example. I have a client in Temecula with a VA loan of 2.5%. We listed their home and marketed it as a VA assumable. The interest alone got buyers in the door. In the end, a civilian buyer assumed the mortgage, got a killer interest rate, and the seller walked away with a great profit. Everyone won. If you're an agent, investor, or seller, this is a strategy you need in your tool belt. So should you pursue it? If you're a buyer, absolutely look for VA assumable homes. If you're a seller with a VA loan, highlight that feature. It can help you stand out in a slow market. And if you're an agent, start talking to your sellers about this. Make sure you're Many don't even realize this is an option. This market is all about getting creative and VA assumptions are a great place to start. If this video helped you, give it a thumbs up and make sure you're subscribed. I've been helping buyers, sellers, and investors navigate all kinds of markets for over 50 years, and I'm here to help you too. Drop a comment below or reach out directly if you've got a VA loan Or want to assume one. Thanks for watching. I'll see you on the next video.
