Unformatted text preview: ng the property – The veteran must occupy the property. The DVA does not have a program for veterans who do not intend to occupy the property. Monthly Installments – Technically, the DVA requires only monthly principal and interest payments. It does not require property taxes and insurance to be included. However, the DVA recommends that these be included, and the deed of trust provides lender authority to collect them. As a practical matter, all DVA loans include the taxes and insurance in the monthly payment. Interest – Must remain at original loan rate except on adjustable rate mortgages (ARMs). Repayments – May be with equal monthly payments of principal and interest or on a graduated payment plan. Prepayment Penalty – None Secondary Financing – Allowed if certain conditions are met; subject to DVA review. 5-38 Licensing School for Appraisal, CPA, Contractors, Insurance, Real Estate, Notary, Nurse, Food Handlers, Tax and Securities 5: GOVERNMENT PARTICIPATION & BACKED LOANS
Discount Points – Seller must pay discount points, except on construction loans or refinancing. Taxes and Insurance – Impounded and prorated in an amount included in the monthly payment. Assumption and Resale – Assumption – Another Veteran. One veteran may assume another veteran's loan by substituting eligibility. • Non–Veteran – The GI loan may be assumed by a non–veteran with USDVA approval, although USDVA approval is not required for loans made before March 1, 1988. Unless the veteran (seller) obtains a “release from liability” certificate from the DVA, the veteran remains liable. Even with USDVA approval of assumption, the veteran does not regain eligibility until the loan is fully paid off. The veteran may sell to another eligible vet who agrees to assume the loan; however, unless the new vet obligates his entitlement to the assumption, the original vet remains liable unless given a release of liability from the DVA. “Subject to”–The veteran remains pri...
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This note was uploaded on 12/30/2010 for the course SOC 101 taught by Professor Zhung during the Spring '10 term at Punjab Engineering College.
- Spring '10