Mortgage Lender Strategies For Increasing VA Loan Volume

Tips For Working With Veterans and Finding VA Loans

Mortgage lenders need every advantage in this ever-changing market, and special financing loans can provide that edge.

One fast-growing segment in the mortgage industry is the number of loans back by the U.S. Department of Veteran Affairs (VA). In 2016 alone, there were 707,000 VA Loans, a 12 percent increase from 2015. Since the 2009 mortgage crisis, VA loans more than tripled in volume.

With the average loan amount at $253,000, the 2016 VA lending volume hit $179.1 billion — with a majority of the growth coming from purchase loans (as opposed to refinancing).

VA Loans are easier to obtain because they are government backed, and do not require private mortgage insurance. Of course, the flexibility of the loans (low or no down payment requirements), means they are more competitive.

This is where opportunities exist for a mortgage lender.

Get VA Mortgage Lender Approved

Getting approved for a VA Loan isn’t just about the buyer; mortgage lenders should be approved by the VA to work with veterans.

Because homebuyers seeking VA Loans seek that specific designation, it’s important for lenders to have the right credentials.

Understanding the intricacies of VA loans makes it easier to secure more customers, and provides a better process in return for those customers. Mortgage lenders must be prepared to guide customers through the VA loan application process, including what paperwork is needed to confirm their veteran status, and what type of credit is required for a loan.

Being VA approved also gives you more authority over the VA loan application process itself, which then makes the the appraisal and underwriting process of the loan (following VA standards) easier.

If you aren’t VA approved, you risk needing to send the application to a third-party lender to get your customer approved. This delays the process and increases the chance that customer will look elsewhere for their mortgage needs.

If you aren’t up to speed with VA Loan requirements, you also risk your customer being rejected during the process, which delays your ability to turn that mortgage seeker into a homebuyer.

Lender Strategies For Working With Veterans — And VA Loans

There’s still a resource and educational gap in the VA loan application process, which is where mortgage lenders can serve as a trusted resource. That alone can help drive more potential mortgage customer leads.

When using a service like RatePlug, a service that provides agents and lenders with a dashboard that displays properties prequalified for VA financing in addition to USDA, CRA, and in select markets, FHA.

With RatePlug, lenders to display their  mortgage payment and branding information within the property listings their agents are sending to homebuyers.

These services can also be used to leverage affordability and VA Loan eligibility. Because RatePlug’s technology is fully integrated within the MLS, it has the ability to identify all properties in the market for VA eligibility. Lenders rates and products are used to calculate a monthly cost to own affordability calculation with PITI, and where applicable HOA fees.

When educating potential VA loan applicants, it’s also important for mortgage lenders to be realistic with their buyers about what types of loans, and how much the potential homebuyer can qualify for. Misleading a buyer about how much they may be approved for will push that customer away, and harm your referral potential.

For mortgage lenders, keeping homebuyers educated about what loan scenario is best for them is the first step in carving out a lucrative niche in the ever-popular special financing loan segment.