The Metro-Detroit housing market is finally heating up again after years of decline. Currently inventory is low, but demand is high.
Real estate agents tell us homes are going so quickly that you need to be ready to make an offer the same day you see a home.
Veterans searching for homes say they are having an even more difficult time landing a home contract because of the loan they are using to finance the property. They say the VA loan, which is supposed to be a benefit, is putting them at an unfair disadvantage.
Tammy Paulson and her husband, Army Veteran Robert Paulson, were excited about the search for a brand new home.
“We thought, we are going to look at all these different houses. We’re gonna choose the best one and put down an offer,” said Tammy.
After saving for 15 years and watching interest rates, they thought they had finally found the perfect time to buy. Robert’s 23 years of service in the military made the VA loan an obvious choice.
Once they made it through the strict vetting process and secured the loan, they thought they were through the worst of it.
They had no idea the hardest part was still ahead.
When looking at real estate listings Tammy noticed something interesting at the bottom of each page.
“I noticed all the financing at the bottom. They didn’t include VA. It was FHA, conventional, cash, no VA. And I said do you accept VA?,” she says.
Often, the answer to that question was no.
Selling agents told them VA loans take too long to close, a hassle their sellers didn’t want to contend with during the process.
They made offers on four different homes. They say their bids were competitive with as much as $10,000 above asking price, but each bid was denied.
“It was to the point where really I just wanted to give up and just move onto another apartment,” said Robert.
They say they wanted to use the VA loan because it was a benefit Robert fought for during his years of service.
VA loans offer veterans: no down payments, lower interest rates and no need to buy private mortgage insurance.
Real Estate Agent, Mike Procissi says he has seen this struggle with his own clients.
He has worked with seven veteran families in the last year, of those only two were able to successfully purchase a home with a VA loan. He tells us the others switched to conventional financing or dropped out of the market.
Real Estate experts say much of the problem has to do with a lack of knowledge about how the loans currently work.
Procissi says 20 years ago these loans could take months to close, but now they can close just as quickly as any conventional loan.
He believes agents that steer people away from accepting an offer from a family using a VA loan are doing a disservice to those who served our country.
The Paulsons hope more education will be offered for agents and sellers.
“I don’t want people to go through what we did. It should have been a happy experience, and it wasn’t,” said Tammy.