[Paul]: So, New England veteran – Thank you fortuning in. If you are a veteran out there who’s interested in purchasing a homethrough VA home loan, I’ve got with me a gentleman who knows the business insideand out. So this is definitely a podcast you want to listen to you.Rick Bettencourt, thank you so much for joining me. [Rick]: Thank you very much forhaving me Paul. [Paul]: It’s not a problem. [Rick]: It’s really an honor to be here dude. It’s apretty awesome sweet set up too man. [Paul]: I appreciate it very much.I really really appreciate that. You’ve been, you’ve been in the home loan gamefor how long now. [Rick]: I just started my 17th year and for a majority of those yearsas primarily my client base has been active duty and veterans. Work with a lotof pcs’ing across the U.S. Different installation, installation and justveterans here in Massachusetts. [Paul]: And so where are you located out of and whatarea do you cover? [Rick]: I am in Danvers. and Licensing wise, I’m good in Mass, Maine,New Hampshire, Florida, Connecticut and Texas. [Paul]: And so the like, the informationthat you’ll be sharing with our audience, does it fluctuate greatly from state tostate? Or is this all like compensated across the entirety? [Rick]: It’s the VA homeloan benefit is the benefit itself and it does there’s no variation from onestate to the next. sometimes you might have different namesof properties like condo or a townhouse or whatnot. But the benefit itself is thebenefit. Okay. [Paul]: To the audience out there, we’re gonna have a lot of questions –thisso, we’ll put this out there as a full podcast, but we’ll also break it downinto segments. So, if there’s a particular question you’re looking for we’ll beable to get that to you efficiently. But more importantly, if you got follow-upquestions or any concerns or anything and you want to get in touch with Rick,down in the description you can find his contact information. We’ll put that thereand please feel free to reach out to him any time. So Rick, what, what is the VAhome loan? [Rick]: So, it was created in June 1944 and so actually, in this past year itcelebrated its 75th year. It was a way to try to helpour World War Two veterans coming back from overseas fighting. To make the thedream of homeownership a reality. All right. So they created this 75 years agoand I will admit that there were some times it was a very difficult type ofloan to navigate. It’s gone through a variety of different iterations it’s alot a lot easier than it is today. Primarily, if you meet and we’ll talkabout them. But if you meet the character discharge requirements, term of service, aveteran or active-duty personnel you can go out and buy a single-family home or afour family home or a three family home or a condominium as your primaryresidence with no down payment. There’ll be no private mortgageinsurance which it’s what we nine veterans have to pay. I did try andenlisting twice, but I have asthma, they wouldn’t, well they wouldn’t let me in.But yeah, so you don’t have to pay the private mortgage insurance. Much morefavorable credit underwriting guidelines. And the lowest interest rates for anyhome loan that’s out there. So it’s really that you and I would talk andbefore we came on – This is the top three. I think it’s one of the top threebenefits that you guys earned. Healthcare, when you get out right? Sowhen you become a veteran. Your health care. your post 9/11 GI Bill, which Ithink is huge and then I think the VA home loan benefit is a top three and Ithink it’s just amazing what it can do for you guys. [Paul]: So, you had made mention ofwhat what some of the types of homes a veteran can purchase. [Rick]: Yeah. [Paul]: It’s acondominium, a single family, two family, 3 family 4 family home. [Rick]: Correct. [Paul]: Are thereother things that can be purchased with a home loan like like an RV or a boat or?[Rick]: So that’s a great great question. There is the ability to use the VA home loanbenefit for a manufactured home. So manufactured homes are are double wides.Essentially mobile homes, right? However, they, there’s a specific set ofrules and regulations that the property must meet. [Cough] – Excuse me – before it’s allowedto go in the VA sort of portfolio. Before you’re a lot of put a VA loan on it. Soif you had a double-wide, and it’s on a permanent foundation. So it’syou know, it’s not gonna drive away. We put a $160,000 loan next thing you know, theproperty’s gone, the next day. If it’s a permanent foundation and the big thebig important piece of it is – when you have a manufactured home, double-wide, itis categorized as such through the registry of Motor Vehicles, right? Sobefore VA will lend on that or authorize
registry of Motor Vehicles, right? Sobefore VA will lend on that or authorize the lending on that. The Registry ofMotor Vehicles must give up title and it must now be taxed as real propertywithin the town. So it’s got to be legitimately a home that’s being taxedby the city of the municipality and it is a very good in a very affordable wayfor a veteran to purchase a home. We see a lot of these in southern New Hampshire,southern Maine, southern Vermont, so nice, nice, nice, opportunities. [Paul]: That’sinteresting. And so is I guess there is a process to establishing a residence. So,for instance, someone out there owns this condo-plex, right? What do they need to door what needs to happen in order for them to be A-okay for approved VA homeloans? [Rick]: We um, I’ve been working with condominiums associations for a longtime. It’s actually not that difficult. There’s a big rumor that it takes monthsand years or to get a condo Association approved. So let’s say it’s a four familyproperty that’s been converted to condos right? [Paul]: Mm-hm.[Rick]: We have a checklist. We provided to the developer. They provide it to us. And freeof charge, we will actually submit that to the Veterans Administrationregional loan center in Cleveland and get the property approved for VA. Andit’s, there’s only really two things that will kind of kick you out of a VA loanbeing a condo, being approved. The veteran population, as a veteran or active-dutypersonnel, they tend to be a little bit more transient. So if you’re anactive-duty personnel, UPCS ELA you’re gonna do a duty station here in Boston,duty station down in Texas, or where have you gonna go. [Paul]: Right. [Rick]: So one of the bigthings for condos, is in the master D, the bylaws the rules, if there’s a leasingrestriction – it’s a dead deal. Because that prohibits the veteranfrom renting their property if they so choose to move out. [Paul]: Well that’s interesting.[Rick]: You can’t, you cannot have a leasing restriction because that says theveteran must get permission to rent it. Well if the trustees say well we don’twant to rent it. Now you can’t rent it. You run the riskof a foreclosure. If you have a foreclosure, you’re gonna lose a portionof that that VA benefit. So leasing restrictions is a no-no. The other onewhich we see very rarely, but it is occasionally inside the the rules. It’scalled first right of refusal. So first right of refusal says, all right,Paul owns a condo and Rick Betancourt Condo of Association. And you want to sellit. I have the first right of refusal. I could say to you, nah, I don’t want you tosell to that people. You know, you can’t sell it. That’s the first round ofrefusal. That is a automatic no-no as well too So that’ll deny it. Over the last 10years, I’ve helped probably 70 plus condo associations in southern New Hampshire andmass get approved. So most of the time, it’s not going to be an issue. Becausewill we review the docs, we’ll take a look, take a peek, and if it’s not worthsubmission because there’s restrictions are there, we just won’t do it. [Paul]: So Rick,with a VA home loan who qualifies? [Rick]: So there’s a series of requirements thatyou got to make. That you gotta meet. So, if you are a veteran and you served twoconsecutive years on active duty, regular military, so Regular Army, Navy,Marines, Coastie, Air Force, two consecutive years and you had an honorable discharge,or general under honorable conditions, or you were medically discharged – Then youwould be eligible. Okay. [Paul]: Okay. [Rick]: If you during that time if you served underU.S. code title 10 orders, deployment, Operation inherent freedom, gothicserpent, inherit resolve, or something like that – you serve 90 consecutive dayshaving honorable or general under honorable conditions or medicaldischarge under US title 10, then you’re eligible. Okay. Active duty, ifyou’ve been in the military and you’ve served 66 months or 181 consecutive daysin your active duty, you’re allowed to go ahead and buy a house. So you could be,[Paul]: Wow [Rick]: Go bootcamp, your in for bootcamp for threemonths, you go to AIT or you go to you know you go to whatever specializationyou’re gonna go to – once you hit 181 days in active duty, you can then go ahead andapply to purchase a home. [Paul]: I imagine sorry to interrupt, I imagine that anindividual they can’t just go out, if they’re are an active service member, youcan’t just go out and buy a home. Like if you’re a private first class you knowand you should be at the barracks, you can’t, is there like an authorization or memo or something? [Rick]: From someone
can’t, is there like an authorization or memo or something? [Rick]: From someone who’s not been in the military, whodoesn’t understand, I don’t know the rules and regulations within each branch.But my understanding is, that you’re not allowed to live off-post. In somebranches and until you’ve been in so many months or so many years. Also Ithink there’s a provision if you get married. You’re allowed to move off baseor off post I think. [Paul]: Nine times out of [Paul]: ten yeah. [Rick]: So, without, I’m not an expert inthat piece but I guess if you’re a private first class, you’re an e-1 or e-2,you need to a specialist and you get hitched and you go buy a house, Iguess you can. I mean, they’re not gonna get BAH if they’re living on post. But ifthey go off post, you’re gonna get your BAH and that’s gonna help you buy a youknow that’ll help buy a property. [Paul]: And is that already taken into considerationprior to them applying because obviously once they start living off-base[Rick]: Yeah. [Paul]: they’re gonna make more money right? [Rick]: Who they get the BAH yeah [Paul]: Right [Rick]: Yep. [Paul]: So,is that something that they already take into account?[Rick]: So what I would do is, if the young, if the young military personnel is lookingto move, we get their order. Well usually, it’s not orders on a PE, if there’sorders if it’s a PCS. But if they’re moving off-base there’s generallyauthorization to do so. And then we look at, we get the authorization and thenwe’ll find out what zip code they’re in. And then we can do a calculation of whattheir BAH will be. [Paul]: Okay. [Rick]: And then figure out if they’re going to qualify for thehouse that they’re looking at. So yeah, this is a, it’s a, it’s,there’s a few extra steps that you have to do.same thing, with we see this a lot of PCS, not a lot of active bases up here inMassachusetts. You got Hanscom, and then you have Joint Base Otis, youhave Joint Base Westover. But we have a lot of active coasties. Coast Guard bases.So we have Boston Gloucester. So we’ll see a lot of, I see a lot of New Orleansguys, Coast Guard, stationed down in New Orleans, coming up to Boston orGloucester. So I’ll get a copy of the orders. I know their duty stations gonnabe the Gloucester or Boston. So I can use their that zip code and calculate theirBAH and then I know their pay grade and I know their term served, how longthey’ve been in. So that with, that or they’re married. If they have marriedthen if you have dependents then your your BAH goes up. So, we get that, I meanactive-duty personnel, they’re the easiest to quantify. If they’re if theywere able to buy a property or not. Because everything is standardized. [Paul]: Right.So one of the things is this may be a little in the weeds, but one of thestipulations for VA healthcare is the one that you would just mentioned priorto, that you have consecutive service for X number of months. [Rick]: Right [Paul]: Honorableconditions and and all that kind of stuff. However that only is applicable toindividuals who served after like September something or other back in1981. Prior to that, a veteran can qualify for VA health care if they’ve had oneday a service and were discharged honorably. I mean, that there were a lotof individuals say like Vietnam they went out did one tour came back got outlike they were in for a year and that’s it so for individuals that are in thatcircumstance prior to 1981. Is there like a different stipulation? [Rick]: No because ifyou were drafted and you went in and you [Rick]: served boots on the ground, or underTitle 10 orders and you were in Vietnam and you just did one year and you gotout honorable discharge. Then you can buy a house. You can use the benefit. I have seen, Ihave seen – So sometimes, you will also be allowedto have the benefit if it was a forced reduction. So if all the sudden – So therewas a veteran that we helped recently in Lynn. He did not serve two consecutiveyears of active duty. He only actually did 18 months active duty. He wasdischarged after 18 months but due to a force reduction. So he was forced out. Hewas able to buy a house. Because he, when you look at the DD-214 on the member 4.Which is what gives us the character of discharge. The member one, two, andthree doesn’t. But the member 4 will. So on the member 4, it also has the notesor the reasons for discharge and right there it said forced reduction. So that Isent that down to the Certificate of Eligibility processing center in Atlanta.They know the girl that runs it and I said, hey listen and this is a forcereduction. This doesn’t seem.. she’s like
download roulette pc game free download said, hey listen and this is a forcereduction. This doesn’t seem.. she’s like
said, hey listen and this is a forcereduction. This doesn’t seem.. she’s like ah, let me look into it. And sure enoughthey were able to give him the certificate of eligibility because hewas clearly a forced reduction. During a, it was like mid eighties or something like that.[Paul]: Okay interesting. And then as far as the eligibility goes, is this something, Imean a a service member unfortunately passes away and you know, the the familyis there and things gonna be difficult Is is the VA home loan something that’safforded to family members in any capacity? [Rick]: Only surviving spouses. So ifthe – It’s a surviving spouse of a veteran or active-duty personnel who’s passingwas directly related to a service connection. So if – Gold stars wouldautomatically have this service, you know, would it be able to have the VA benefitconveyed to them. I’ve worked with a few. Half-a-dozen in the last year or two inMassachusetts. I see a lot of Vietnam veterans who had Agent Orange.They were boots on the ground. They had Agent Orange cancer. [Cough] 100% disabled whenthey got back whatever. They passed due to the connection of the Agent Orange. Wewere able to convey the spouse benefits over to, over tothe spouses, surviving spouse. Obviously, our unfortunate situations where they’rekilled in action, that’s that goes without saying,but if you’re a spouse and your your husband, for example was a veteran, and hejust had a random heart attack unfortunately and passed away. but wasnot disabled, was not connected to service related, he just that then – That’snot conveyed over right. [Paul]: Okay. [Rick]: There’s a specific rules and regulationspertaining the surviving spouse and how that works. [Paul]: So, it had to have been anaction that happened during military duty that unfortunately took the life ofthe service member. Or they had to have passed due to our service-connecteddisability. [Rick]: Correct, yes yeah yeah. that’s That’s the big one. And. and I think, Ithink, if there’s are. If there are spouses that are listening – andthere’s a lot of our Vietnam era veterans who probably hadservice-connected diseases and just you know situations. [Paul]: Right. [Rick]: They pass but theynever got rated. I think there’s a way to kind of do that. I think you can I thinkyou can get adjudicated after the fact. I’m not sure. But I encourage everyveteran that’s out there like if you have not yet gone to file for aservice-connected disability claim. Do it. And don’t wait -I see veterans all the time that come in and they’re like yeah you know what Ijust never got around to it I’m fine I have both legs both arms botheyes I’m good. I’m like okay. I go why didn’t you know,.I had one guy, he waslike how’s your ears? he goes, oh they ring all the time.I go no kidding? This is funny, he is, I go why – because there’s a thing – If you ifyou if you’re a disabled veteran you don’t pay the funding fee. We can getinto the weeds and that later on. But you know, if you apply for aservice-connected disability claim before you buy or refinance your home,then you get adjudicated six months, nine months, ten months later. I can actuallyget the funding fee refunded for you. As long as, because the [Paul]:Wow. [Rick]: The approvaldate is retroactive to the data submission. So the eyes of the VA eventhough you weren’t disabled when you bought your house – you had applied forthe service-connected disability. So you apply for a service-connecteddisability in January, your – You buy your house or refinance and April, whatever itis. All of a sudden December, you getapproved. Come back to me or whatever mortgage professional you use and saidhey I’m good I got disabled. In the eyes of the VA, when you bought your house youwere disabled. So I get the award letter. I contact our servicing Department andsay start the funding fee refund and they just they’ll do that too. [Paul]: That’sbananas.[Rick]: So this this army reservist comes in and he did 12 years and younever deployed, but he did his 12 years and he had, you know, he had all hisqualifying years and AT and all that stuff. And he’s yeah you know I’ve never filed.I’m like oh, how’s your ears? They ring all of the time. So I’m like, alright, what was your MOS?and he’s like well I was I was RT he goes I was artillery. I’m like 105 155he goes, oh no, I use the big ones the 155. So I go, so how long were you in? He goes 12years. I go, so let me get this straight. You did 12 years in the reservesyou fired big guns once, one week in a
You did 12 years in the reservesyou fired big guns once, one week in a month or two weeks a year all the timefor 12 years. You, your hearings ringing. Your ears ringing.You don’t think that’s related? He goes oh yeah. His wife is sitting next to himjust going like this. [Laughter] I go, how about do me about do me a favor. Go please apply and then thenwe’ll buy the house and we can do the boat right? So he goes and applies hetook the time. I go, and I’m just telling you take a day off of work. Do thisplease for me. He was all right and sure enough he applies to me he went throughthe DAV. He did is his claim. Sends in, you know. And then he bought it bought hishouse in February and March whatever the hell it was.And sure enough, he got 40%. Come to find out there was like his his hearing [Paul]: Wow.[Rick]: Itwas his hearing, his shoulder from like constantly loading the rounds in and hehad some calcium whatever it was. And yeah. And now you’re disabled veteranwith 40% he gets his 350 or 400 bucks a month. Listen, the funding fee was, youknow, the funding fee was refunded to him. He got that.And then Massachusetts General Laws section chapter 59, you have the taxdiscount. So between 10% and 90% he got five, four hundred a year off hisproperty taxes. [Paul]: Oh because he’s got time for a day [Laughter] [Rick]: Just because he wanted to buy ahouse and you know, and we’re out and – I’ve been working military for long time.That’s why I was asking these questions. I go listen, a lot of the veterans outthere that you know you don’t have that. The most – I think the last actually was ayear ago. The last draftie finally retired. He was like E-9 or somethinglike that. Everyone that’s in the military right now enlisted. [Paul]: Mhm. [Rick]: Right. Soyou guys decided to write the check go out there and do that and essentiallywith all due respect, you guys became pieces of equipment for United States ofAmerica. I don’t know about you, but – [Cough]Anything that I’ve ever bought or acquired, when I got rid of it wasn’t inthe same condition when I got it, right? So [Laughter] I’m just saying, most the most, of thetime there’s gonna be something. I mean I’m not saying defraud the system, butI’m saying look hard and fast about what you did and look at your history and howlong you were in. And that money’s been, that money’s been allocated for you guys.It’s there. Just go get it. You’re not taking it away from somebody else, likelittle Johnny over here is not gonna get as a service-connected disabilitybecause [Cough] Tommy over here who never deployed used it. It’s not – it doesn’twork like that. You know that. [Paul]: Yeah, no. It’s it’s a, it’s definitely a demandsystem. I tell veterans all the time that, by actually using the VA you help itgrow. [Rick]: Oh yeah. [Paul]: And by it growing, it then enables it to help more veterans. So byyou going – whether it’s a medical appointment or whatever the case may be,you’re not taking away from someone else. You’re actually helping the system grow. [Rick]:100% percent. [Paul]: And so yeah. It’s, it’s, it’s a point of contention, or I shouldsay contention. But it’s a point that I make to veterans all the time. It’s likeit by you using the system you’re helping it. By using a VA home loan,you’re helping the VA grow. And because if nobody if in 2020 nobody applies for aVA home loan that Congress can be like well I guess we don’t need funding forthis anymore. So bye-bye VA home loan. [Rick]: It’s absolutely a demand system. You know,the more that it’s used, the better it is. I mean, that that example is only one oflike maybe a dozen or so. [Paul]: But I’m sure you get a ton of stories. [Rick]: It’s just bananas. I’m likeyou playing with howitzers for how many years? Twelve years? Isn’t there likea lawsuit of something out there. Like I won’t the ear protection? [Paul] Oh, the 3m thingwhatever. [Rick]: I go did you use hearing protection? All the time it workedreally good. I’m like your hearing is ringing all the time. It didn’t work thatgood. [Laughter] He’s like, all right I’ll go do it. And his wife was just like thank you forthe love of God. But I’ve been trying to, she’s like Rick, I’ve been hammeringthis guy for weeks to for months years to go get checked out. So it worked outgood for him. [Paul]: So for a veteran in order, veteran orwhomever is eligible, to use VA home loan they need a Certificate of Eligibility.so what is a Certificate of Eligibility? And how do they obtain it. [Rick]: That’s the,that’s the Willy Wonka golden ticket, right? [Laughter] So that’s, that’s what gets you ahouse man. Well that’s what allows you – so that’s what allows you to qualify toapply for the benefit. So it’s kinda like two steps right? First as a serviceperso,n service, service men and women – Do [I have enough of the VA criteria toapply for the home loan? So that’s what the, the Certificate of Eligibility is. Sonow, was it three or four years ago the [ebenefits.va.gov site was all updatedand now it’s you have registry or account and all that. You can get itthrough there. So you can actually order your own Certificate of Eligibility. [Paul]: Okay.[Rick]: So a veteran can do that right? I will be the first one to say – There are a lot ofpeople in my industry that are not so honest and somewhat maybe unscrupulous.And like, Oh we’ll get the COE for you. Honest, but they won’t share it with the veteran.They’ll just kind of hold onto it as a way to kind of keep them from shopping.[Paul]: Yeah that’s Shady. [Rick]: Oh god, I tell you, it’s very shady right? So, if you can do ityourself, do it yourself right? Um you go in – There’s an ebenefits.va.govwebsite – There’s on the right-hand side, it’s like housing or certificate ofeligibility, click that button. I think you plug in your social securitynumber and you hit enter and it might actually give it to you within secondsright? A lot of the older veterans, there assisted, their their electronic gate isnot in there, not yet right? [Paul]: Right. [Rick]: Right. So some of the youngerguys, like someone like yourself ,or is that that’s been in OIF, EF and it’ssince 2003 and on – Good chance that your information’s gonna be electronicallyavailable. So you just click, order COE, it comes in. They’ll email it to you as aPDF and you have it. So about 30 percent of the time when I work with a veteranthey already have the COE. That’s you know, that’s yours. Don’t let ever let anyLinda tell you that it’s oh we’ll get and we’ll hold on to it. We can do the COE’s aswell. So two ways the veteran can order themselves which I highly recommend. Sonow you sort of control the transaction a little bit better. it’s your and thisis mine I’m gonna go to lender ABCD and F and get the best deal right? [Paul]: Right.[Rick]: If you’re comfortable with your mortgage professional, then we have a directportal access it’s called web lgy or web loan guarantee, where I have both options.I can do the electronic version where I type in your social security number andyour date of birth, hit a button and it pops up. And if you’re a younger vet, it’sgonna show up electronically instantaneously. We get the P we get theCOE and I’ll send you a copy. Sometimes, about 40% of the time, 30% of time, yourdate is not in there electronically or your reservists National Guard. So thenwe have to do a full application and we have to get the 1880 form filled out andsend it out. We upload it to web lgy and they send it back usually takes like 24or 48 hours. But civil of eligibility, will tell you that you’re eligible. Tothen engage with a lender to apply for the VA home loan. [Paul]: And so, in a in aninstance you said, what 30 to 40 percent of the time you have to do that wholeentire advocate process. [Rick]: Yeah. [Paul]: What, what can a veteran expect? Like is theredocumentation that they need? Do they needed a DD 214 and all that or? [Rick]: Yeahthey will. So, if I get your information electronically then I don’t really needyour dd-214 because you would not be eligible for the Certificate ofEligibility if you had a dishonorable discharge. Orif you had an OTH that wasn’t vetted and said, you know sometimes, ohyou didn’t have enough term of service right? [Paul]: Right [Rick]: But if I get that COE thenwe’re good. If it’s not electronically, or automatically provided then I need the I need the member 4, DD 214, which shows a character of discharge anda lot of times veterans like well which [one? All right because every every tourof duty you guys get a DD 214 right? So you – I’ve worked with some veterans theyhad six, you know, they’re like, like which one do you want? I’m like, I don’t really care. [Laughter][Paul]: It’s the one that says you atleast have a deployment and all that. [Rick]: Give me one that shows ten months andhas an honorable discharge. [Paul]: Good deal. [Rick]: It’s pretty cool. [Laughter] [Paul]: So with VA home loan, how much, how muchof a factor does someone’s credit score take into account? and I mean whereshould somebody be? [Rick]: So a lot of lenders will tell you that the minimum VA creditscore is a 649 or 660 or 620 or 580. The VA loan was created without aminimum credit score. So the veterans, the Veterans Administration home loanbenefit doesn’t have a credit score of minimum requirement. The VA doesn’t lendthe money though. Lenders lend the money. So they are the ones that accept therisk right? We can talk about how the VA loan guarantee works another time. Sothat’s a very kind of deep dive conversation. But when you’re talkingabout credit score, the minimum credit score that some lenders will use is580. Now that doesn’t mean you’re gonna get a loan. That means that, okay, we’llconsider down to a 580, but there better be some really strong compensatingfactors as to why you’re there, right? Just because you decided not to pay yourbills anymore and you know I was just cutting – that’s not going to work. [Paul]:They’renot gonna look fondly on that. [Rick]: No but hey Rick, my credit score dropped and I had aPTSD trigger, had some serious issues come up, and there was a period of 12months that I had a tough time – I was dealing with some mental health issues.And look he has 12 months Rick, my credit wasterrible, 590, I’ve always paid my rent on time. I can document that right? One thingI notice about veterans in my nearly twenty years of doing this you, all verygood and making sure that you pay your rent on time like rock stars. That’s theone thing that I notice. I think it’s a cultural thing with military right? [Paul]: Wellas I was doing some reading, that it’s like the veterans are 25-30 percent lesslikely to default on their home loan than like any other demographic in thecountry. [Rick]: Yeah, they will. If you wanted to lookat stats the default foreclosure rate for VA home loans across the U.S. isequal to what a conforming non-veteran loan is like a Fannie Mae, Freddie Mactype loan okay. They’re almost identical. So average down payment for anon veteran loan is about 20 to 25 percent, right? Average FICO score creditscore is about a 780 okay. But there’s a 20 – Those loans don’t foreclose generally.Right now you compare it to a VA loan in 2019, the average FICO score for aveteran was about a 707 710 okay. Average down payment for a purchase was100% financing – no down payment right? And average liquidity for conforming loansis sometimes up in the 70 to 90 thousand range. Average amount of assets liquidityfor a veteran in 2019 was about 21,000 That now, that’s a that’s not a lot ofmoney. It sounds like a lot. But it’s not. That’s a combination of checking, savings,401k, TSP. Things like that right? So not a lot of money. So veterans are buyinghouses with no down payment, no skin in the game, as lenders or some people callit. No private mortgage insurance, yes, there’s a VA guarantee on that. But theydon’t default. They have a lower FICO score by 80 points. They have less moneyin the bank and they’re buying houses with no down payment and one would saythat’s a worse loan because there’s no skin in the game. There’s no down payment.The lower credit score is less money in the bank, but those loans don’tforeclose and don’t default. Same way as non veteran loans. So, when someone arguesto me that oh gee Rick you know, people with down payments – those loans perform. I call, I call BS oh those. It’s absolutely not true. When you especially,When you’re comparing VA – and I think you know, it’s different to say about Federal Housing Administration, FHA or USDA loans – that’s different.Veterans ,I think a lot of it has to do with your culture. How you were trained.How you were brought up. Just in general the way that you guys think. You guys aretrained to not lose. You guys were [trained to win all the time. Take care ofyour family. And I think that shows in the way that the VA loans perform. Youguys always pay your bills on time. You mean, you might, you might havefive repossessions on your credit cards loans right?But that rent 2000, 2500, 3000 – Whatever it is. That rent is always paidon time and that mortgage is always paid on time. So, when we’re lookingwith that credit score type situation to kind of circle back it’s like – When youhave a 580, 85 don’t expect to get a lot get a house. But you earned the right toapply for it so let’s look at what are the compensate – what do you have? Welllook you know, I don’t have any debt, I’ve been rebuilding, the reason for mydraw might default so my bad credit was at PTSD. I had surgery that was relatedto my military service. There’s something to that of a story – They call the VA loana story loan for a reason. It’s a story loan because the Veterans Administrationdoes not want to say no to you guys. They want to say yes as often as possible butyou got to give a reason to say yes. Can’t say I don’t know for two years Ijust didn’t want to pay bills. I just didn’t like that anymore. Okay, well I’mnot gonna give you a half a million dollar loan because you just decided notto pay bills. But, if you know, Johnny Jo Jo poor veteran that he might have hadTBI. He might have had a PTSD issue. There was you know, it was a Dear John letter Icame you know, he was deployed and came home – Tons of scenariosbut if you’ve shown hey I have been on time the last nine months, 12 months andmy scores haven’t come up. I’ve saved up a little bit of money. I pay my rent ontime and my work history is good. That’s a loan that we’ll take a look at.We’ll say all right, can’t get you a $350,000 house today. I can find you know,we can call if we can counter and qualify you at 225 because you have allthese compensating factors. So it’s most lenders will stop at a 620. There’s a, there’s some lenders I’ll go down to 580 but just expect lots of paperwork,lots of explanations, lots of letters explanation – Be sure to verify yourrental history for 24 months and you know, it’s it’s a bit it’s a bit gnarlybut it you know, if you’re willing to put the work in we’re willing to put thetime in too. [Paul]: So with a with a car loan I mean the better credit score you haveyou know, the better rate you’re gonna get. You see it all the time. Oh you know,zero point zero percent financing and all this other stuff. [Rick]: Yeah. [Paul]: Is that the same thing with purchasing a home like the better score you have thebetter rate you’re gonna get? [Rick]: Yeah, you got to be careful, right. So that’s wherelenders, some lenders will I they got artificially increase the risk thresholds that they have. Expect your rate on a VA loan to be higher when you’re underthat’s 640-660 range all right? At 640. Really the rates aresort of categorized with VA on your what we call your FICO score bucket.You’re in those buckets of credit scores. So 580 to 600, 601 to 619 or 620. 621 to 640,642 666 so it goes up by 20. Usually there’s going to be variations in yourrate when you’re under 640 and when you go below 600, it’s usually – It could besubstantial. Some lenders will artificially because it’s they can makemoney on it right? We’ll elevate what that risk. So if you’re in that 580 to 600 range -Absolutely shop your mortgage round. Absolutely. I mean I would be going 3 or4 different lenders and seeing what’s out there. If you’re at 680, above creditscore, there’s gonna be very very little variation in rate between 680 and even a780. So it’s not gonna be a huge difference. Loan size does play a factorin all rates for all loan programs. Smaller loan, small the amount of money that alender is going to make over the lifetime of the loan. The rates tendto be a little bit higher. So if you’re if you’re looking at getting a VA loanfor 150,000 and you’re you know, you have [Rick]: 780 credit score, your rate might be alittle bit higher than somebody with a [Rick]: 780 credit score and a $600,000 housebecause there’s the way the loans the way the loan – [Paul]: it’s more money to be made.[Rick]: It’s the way the little pricing works. You know what I mean? So it’s just, you have to,do you have to do your research. You have to do your due diligence, without a doubt.[Paul]: And I mean, I’m an individual who checks their credit score every once in a while.Well actually I just make sure that someone hasn’t stole my information openit, because actually had that happen. What a nightmare that was. Went furnitureshopping like Amazon and I didn’t find out until 7 months later but. [Rick]: Hear a lotof veterans. You know, I don’t know what it is but a lot of you guys, you get yourID stolen. Their identity stolen often. I hear it a lot. [Paul]: I don’t know. I didsomething wrong [Laughter] But, I mean, there’s a lot of ways for a veteran to be able to, oranybody, to be able to check their credit. I can either do right in my bank. I can doit through every credit card company now offers it. [Rick]: They use go – [Paul]: Like creditKarma or something like that. Is the number that I’m looking at, because theyvariate like greatly, right? Is the number I’m looking at legit or is there just anentirely different number that you’re looking at? [Rick]: Yeah. There is. It’s a hundredpercent different. So without mentioning names cuz I’m not allowed to.There’s several large online credit notification companies. I would highlyrecommend you don’t use them. There is some credence to the fact thatthey are collecting data and potentially selling it. Also, there is eight differentcredit score algorithms that create your credit, your FICO score right? There’seight different FICO algorithm. They called FICO 1 through FICO 8. Okay? FICO10 is the new one coming out sometime this year. The lending industry uses FICO4, okay? So you mentioned credit card. I have a capital one. They use credit wise.[Paul]: Yeah. [Rick]: Okay, Discover same thing – uses credit wise. And if you look at thebottom of the credit wise page on your phone, it’ll show you the fine print. Inthe first two or three lines it says we [Rick]: use FICO 8 – your credit scores may varyfrom whatever wherever. [Paul]: Okay. [Rick]: FICO 4 is an older algorithm. It’s moreconservative so therefore generally, if you have an 800 credit score and on alarge online credit reporting company that people get to use in access forfree, there could be anywhere so, 22 a 60point variation between that – [Paul]: What. [Rick]: To what we use, correct. So it’s, it, is – There’s afew companies out there. I don’t know who they are and I can’t really endorse them -But there’s a few online companies that [Rick]: allow you to pay to get your own creditscore and you can request for a FICO 4. [Paul]: Okay. [Rick]: And if you’re serious aboutpurchasing a home. I would reach out to those. I would do some research and onlinetalk to some people. Talk to a more professional and if you sign up forthose services, then request a FICO 4 credit score because that’ll give youthe closest score to what I’m going to get. [Paul]: Okay. [Rick]: Generally auto dealers aregoing to have a credit score it’s a little bit different than what we have.So, if you’re looking on your phone andcredit wise has given you a 760 – it’s going to be a little different.I’ll tell you I refinanced my property in October of nineteen and my creditwise, which was a FICO 8 algorithm, said my credit score was a 797, whatever wasseven, eight hundred or whatever was. Wasn’t always like that because when Igraduated college I was an all day train wreck. [Laughter] Now you feel like dude you don’teven have credit good enough to get a library card. [Laughter] We’re not gonna. It was bad.That was 22 years ago. So I’ve worked really – as everybody should -Work really hard. You know, I mean and I don’t like to say bad credit. Like nobodyhas bad credit guys. Like if you got a you got a lower FICO score, you’vedealt with some stuff, you’re all learning – it is what it is. A lot of ourmilitary didn’t have the financial literacy or the education when they cameout of high school and it’s not your fault. Don’t blame yourselves. Don’t be you know beat don’t beat yourself up cuz your scores are lower.You know, it’s just slow credit right now. And you got to meet, you gotta findsomeone is gonna help you build it but you guys don’t have bad credit. Don’tever say you have bad credit. So i really, I actually asked themortgage guy who took care of my my I refi and I go was when I already goesthere whenever I work with a borrower like what’s my credit score? And mine oncredit wise was was my Capital One card – It was a 797. But when he sent me thecredit report from when I got the refi it was a 741. 47point difference. That was me personally [So you will see a variation. Definitelybetween FICO 8 and FICO 4. So it depends. [Paul]: So don’t be surprised out thereif your numbers are low. [Laughter] [Rick]: It happens all the time. So it’s like you know, people cometo me like aw Rick, I finally got it up to like you know, my my my online creditplace is telling me it’s like I’m a 605. I’m like oh. I’m like, I’m just I don’twant you to get upset, I’m just telling you right now that when I check it it’snot gonna be that. Now every rare once in awhile every rare once in a while, itdoes come back a little higher. But it’s not often. It’s not common. So,I would say ideal credit score for VA is around a 660 plus. It could get a littledicey as you go underneath that, but that does not mean you should not apply. [Paul]: Butthat’s all indicative of the lender them self. It’s not, as you would said or,if you believe the previously stated, It’s not something that’s decided by theVA but by the individual lender. [Rick]: Ya. Whether they go that low or not, correct.Yeah we will sit. Cause the VA, what the VA does is the VA says, I’m gonna lend Joeyou know – Well the lender says I’m gonna give Joe $400,000 VA loan because hequalifies right? The Veterans Administration what they do, is theyguarantee 25 percent of whatever Joe borrows. So in the eyes of the lender[Paul]: It’s that’s kind of like the mortgage insurance, so to speak. [Rick]: It’s the funding fee,part of it. The Veterans Administration issues a 25% guarantee on whatever theveteran borrows. There’s different variations of scenarios, but for the, forthe basics. So that means if Joe borrowed $400,000, the lenders only on the hookreally risk wise for 75% of that. So if all the sudden, Joe says you know what, I’mgonna go move to the Amazon and farm coconuts. [Laughter] And you know and never pay thebill ever again. I’m gonna let the house go to foreclosure. [Paul]: Yeah. [Rick]: That lenders onthe hook for only seventy five percent of what’s borrowed. The VeteransAdministration loan guarantee division cuts us a check for a hundred thousandpays off that balance and then we bring in the foreclosure proceedings and dothat. So that’s why you know, so that [veteran lost a small portion or a largeportion depends, of the benefit, but doesn’t mean he could never you know buyagain. He probably could depends on where he goes. So there’s, there’s some math to that. [Paul]: Sothat that actually goes into the next question that I want to ask. And again, Iwant to remind the audience out there – There’s a lot of good content that we’rediscussing here. This is awesome. This is one of my favorite podcasts I’ve done sofar. [Rick]: Thanks man. [Paul]: Yeah, but if you want to get in touch with Rick if you got follow-up questionsor anything like that – Contact information is down in the description.So feel free to jump down there. We’ll have his LinkedInprofile information, business card information, stuff like that. So if youwanna get in touch with Rick, some follow-up questions concerns or whathave you, feel free to reach out to him through the information down in thedescription. [Rick]: Yep. [Paul]: So something that you had mentioned, isthe ability to reuse or reapply for a VA home loan, even though you’ve had aforeclosure. [Rick]: Correct. [Paul]: But I want to before we actually get into that, I want to back upa little bit and that’s the fact that you obviously can reuse this benefit. [Rick]: Yeah,yeah. So many rumors, you know, you can use a benefit over and over and over andover and over and over again. So especially if you’re a veteran that had,has a service-connected disability rating, which exempts you from thefunding fee. Then you never pay the funding fee. So if you wanted to buy 50 homesin 50 years. You can go buy a house every year. Buy it, sell it, buy it, sell it, buyit and keep using the VA benefit. Which is awesome. We could do a whole hourpodcast on the funding fee and the different scenarios and how that worksBut, if you’re a non disabled veteran and you’re using your benefit again to buy ahouse with a hundred percent financing you have to pay a subsequent use fee,funding fee, it’s a little bit more expensive. Instead of the traditional 2.3,percent it’s now 3.6 percent. It’s never out of pocket. It’s financing a loan. Soto give you a rough idea – Veteran Bobby bought a $400,000 house. No down payment and he has no disability. His loan amount was 408 and change. Two pointthree percent funding fee was financed into the loan, okay?About a year two later he sells that house and decides, you know what, I’mgonna take the profit I’m gonna spend it at Mohegan Sun and I put it all in black [Laughter]and then I – But you know what? I lost all the money but I still want to go buyanother house with no down payment and it’s six hundred thousand dollars inPeabody Massachusetts whatever it is okay? Sowhen I get the Certificate of Eligibility, it tells me that you Joe, theveteran, have used your benefit before. You have full entitlement, but you haveto pay a subsequent use fee of 3.6% The veterans like, I don’t, I don’t Rick, I don’t have20 you know 18 whatever that number is out-of-pocket. You don’t pay it it’sfinanced into your loan. Oh that’s great. So we’ll know, this six hundred thousanddollar loan that loan amount that he borrows would be the six hundredthousand for the purchase, with no down payment, plus the three point six fundingfee. So he’d actually have a loan amount of like six twenty one six[Paul]: It’s still no PMI? [Rick]: None, and still some of the lowest interest rates in the worldfor residential financing but if you’re a disabled veteran, hence previouspodcast guys, file for a service-connected disability claim. Getyour ten percent or more. You’re exempt from the funding fee. You don’t pay it. Sosell the house for four hundred. Spend all the profit down to Mohegan onroulette. [Laughter] Go buy a six hundred thousand dollar house, no funding fee. Same thing.[Paul]: So, I own a property. I used the VA home loan to buy a condo. Couldn’t,couldn’t afford financially at that point, I just started out my career orwhatever, couldn’t afford a single-family home or, or, a two or three or four familyhome right? [Rick]: Yeah. [Paul]: Cause you have those options. So I bought a condo and I don’twant to get rid of the condo. I’d rather rent it out. [Rick]: Yes. [Paul]: But I need a new primaryresidence. So, what’s the deal with that? [Rick]: So that’s kind of like goes into acouple different things. January 1st, you know about HR 299, the blue water NavyAct. [Paul]: Yep. [Rick]: So thank God our, our, our Navy and military personnel who aretransporting that stuff over there, finally are going to get coverage. You know, howthat works, I don’t know. But inside HR 299, the blue water Navy act, was aprovision that eliminated the VA loan limits. So we have to touch upon this alittle bit. So now there are no more VA loan limits for a veteran buying a house,first time, in any state in the US. So you literally could go.You could be in San Diego and purchase a 2.5 million dollar home with no downpayment, no private mortgage insurance. [Paul]: What? [Rick]: Ridiculousrates. [Paul]: But this is only the first time you purchase not a second or [Rick]: So, so, there isso like [Paul]: Not a subsequent purchase as you [Rick]: Correct. So here so, let’s talk about – nowthat’s just the tip of the iceberg on how the VA, this new, this new billworks right? HR 299. Prior to HR 299 coming out, VA loans were associated withloan limits, county loan limits, across the U.S. okay?There’s 66 counties in the U.S. that are identified as high cost counties -expensive places to live. There are some places in New York, in Massachusetts. Our high cost counties are Suffolk, Middlesex, Essex, North Fork, parts of Bristol and – Is that it, five? Yeah I think that’s it.Those are high-cost county low limits. So, what happens is, and there’s also twohigh-cost county loan limits in southern New Hampshire, Rockingham and believeHillsborough, is there. I got to double check that. So, you’re a veteran and youown a condo. You used a portion of your benefit to buy that particular property. But you don’t want to get rid of it. I want to retain that property. It’s goodrental income. Maybe it’s an it’s, in a college town. You’re gonna get you know Xamount per month. [Paul]: Right. [Rick]: Plus you’re building net worth and you’re creatingliquidity and it’s it’s all good. So, the VA loan limit cap has beenremoved but for those that are gonna use the subsequent use portion of the VA, useit again, and retain the house that they previously owned, that has a VA loan onit – We have to revert back to the county loan limit, for Essex County or Middlesex -How much benefit have you used? Entitlement, have you used?What is remaining in that County for you, that County loan limit. And then we haveto do some math and then we can figure out [Paul]: Interesting. [Rick]: Then I can figure outokay, you’re buying a $300,000 single-family home in southern NewHampshire. [Paul]: Yeah. [Rick]: What would you buy a condo for Bob? 175. Okay. So in my head, Iknow that veteran probably used, on 175 thousand dollar purchase, probably usedabout forty thousand of his entitlement. I know that Essex County, the VA, the, thecounty loan limits, about six ninety. So that’s about 155 in entitlement. Youprobably could purchase up to about a four hundred seventy thousand dollarhouse with no down payment while retaining the condo that you’re nowgonna use as rental. [Paul]: Huh. [Rick]: So, if you’re not working with a mortgage professionalthat truly understands how entitlement works – And an entitlement, it’s like a jar.And I want to one of my favorite instructors that I teach with he usedthis analogy, the VA entitlement for home loans is like a jar of marbles okay? And youreach your hand in you grab the bunch of marbles and you bought your first houseokay? Those marbles are gone. What’s leftover in this jar is a combination ofthe county and loan limit and your entitlement that you have remaining. Now,I can keep going to that jar of marbles to buy houses, as long as I have reasonwhy I’m vacating to buy a new one – PCS, I’m going from Fort Hood Texas up toHanscom Air Force Base right? Family size getting bigger moving closer to work.Things like that. Moving next door to buying another house with a hundredpercent financing – not gonna work right? [Laughter] Remember, VA is only owner-occupied – youcan’t buy second homes or investment properties. [Paul]: Okay. [Rick]: You have to occupy it soyou gotta prove occupancy. Rick, I want a two – I had this happen Rick, thisguy owned a 2 family in Lawrence. He’s like I wanted buy another 2 family. Likeokay. Where? Like four houses down. I go no, can’t do that. He’s like why? I’m gonnalive in it. I’m like yeah, sure. that’s the you know – There’s no way youcan prove occupancy that you’re gonna – Why would someone go from a two-familyon street A and go four houses up and buy another two family with nodownpayment? [Paul]: Maybe it’s closer to work, yeah? [Rick]: Hundred yards? [Laughter] Maybe 150 miles, but, so theanalogy of the jar and the marbles is a really good one so that helps peopleunderstand like, wow so you can keep using. I’ve had veterans situationallyhave three VA loans on their credit at one time because they transferred fromone place to the next. [Paul]: Interesting. So out of curiosity I mean,you’ve got my mind spinning with all different types of ways. We really couldtalk for hours and hours. [Rick]: I teach a CDLS for mortgage professionals across the U.S. Iliterally teach an eight-hour class on the entire, what we call, 26.7 – seven -that’s the VA handbook for for a loan guarantee. That’s our Bible for workingwith you guys. [Paul]: Right. [Rick]: I teach a class it’s eight hours and people like dude it’sgot to be two days. So there’s so much stuff. This you could yeah you’re gonnayou want I know what you’re probably is, Like I want to rip off scenarios forRick. Like can I make this work? Could I do that?[Paul]: So, it’s a reference your analogy of the [Paul]: marbles. [Rick]: Yeah. [Paul]: Right. Say, so say I have ahome. I have that condo right? I want to get into a single-family home. What if Irefi and I’m not using a VA loan now right? So I refined my condo [Rick]: Into aconventional loan. [Paul]: Into a conventional loan. [Rick]: Yes sir. [Paul]: Do the marbles that werebeing used for that VA loan go back into the jar or are they gone? [Rick]: Yes and no. [Paul]: Okay.[Rick]: So, there is a there is a process and I got to applaud the VA – They did a greatjob creating this benefit for you guys because there’s a lot of different ways.They’re really altering the end of the day. Their goal is to put you guys inhomes. When we teach and when we advocate across the U.S. our mission is – Put moreveterans in more homes. Now not all of you guys are going to buy a housebut, but those that meet the criteria – You all deserve the right to earn you know -You’re in the right to apply for one. So, it may not be a hundred percentsuccessful but we’re gonna gonna do our best to get you guys in. So, to yourexample – You owned a condo, you’re like you know what – I’m gonna refinance into aconventional loan, try to refill that marble jar up to buy another one. [Paul]: Right.[Rick]: The entitlement that you used to purchase that house, is attached to thehouse, not just a loan. However, however the VA does have a procedure called aone-time entitlement restoration and what you’ll do, when we’re doing – I’mdoing helping a veteran do this right now.He’s like Rick, I got this condo, very similar and there’s a good sized condowe’re like a $370,000 condo. He would not have enough entitlement to buy the nexthouse with no down payment. He just, good credit, just not a lot of liquidity,right? [Paul]: Right, right. [Rick]: He’s like so, how do I do this? I go okay,first things first you got a refinance into a conventional loan. I already didthat Rick, we’re good. Okay, good. Now, there’s a special form that the VA willgive you guys to restore your entitlement one time, okay? So, whathappens is your refinance, you fill out the VA form, you submit it. They confirmthat the VA loan has been paid off and They do that internally in their system.They will give you a one-time restoration of full entitlement. For youto then go buy that six hundred, seven hundred, eight hundred thousand dollarhome, okay? With no down payment. Here’s a catch. You can’t do that again. If you try to do that again on another property the caveat is – You have to sellboth. The condo and the house that you own right now. [Paul]: Oh wow. [Rick]: To get yourentitlement fully restored to buy the ext one. So, that sometimes happensthough, where the veterans like, you know, I bought this great house in San DiegoRick and I’m at the end of my career and I want to retire and my family andeverything we’re moving to Boston and that’s where I’m from and that’s what Iwanted to have and in 26 years. I still have enough entitlement. [Paul]: Right.[Rick]: Okay, that’s fine. We’ll and he’s like well my plan is eventually to sell. But the marketisn’t good right now, right? Fine here’s you know, you got to refinance it.That’s no problem. I can refinance. I owe 300 and it’s worth eight hundredthousand whatever. Okay that’s fine. Refinance, conventional, prove it, file thepaperwork. Takes about two weeks. VA will restore the entitlement. We get thecertificate of eligibility confirming full entitlement restored by thatproperty in Boston, PCS or whatever. Just as long as you have enough income tocarry both, your good. [Paul]: So can restoring entitlement be used if unfortunately aveteran defaults on a VA home loan? [Rick]: Mm-hmm. [Paul]: Are they able to restore theirentitlement? [Rick]: Not that way. But you can contact the regional loan center and sayhey, I have a what’s called a compromise loss, that’s what VA calls it. You know, VA,they, we try to use words that you know foreclosure is such a harsh word. Makespeople feel kind of kind of crappy about themselves but it, it – We call it acompromise loss. So you should have received, the veteran should havereceived a letter indicating that – What happened to. And there’s an amount inthere, it says well, you lost twenty seven thousand dollars of entitlement. Ifyou’re able to pay that back, if you can physically pay that back, then you canget your entitlement fully restored. So say a veteran had a $200,000 house andthey, their entitlement loss is $48,000 right? If they came across some money andwere able to pay that back, then they’d get their full and entitlement back. Theypaid back the government. The money that was used to pay the lender for the loss,right? But sometimes you don’t need to do that. Why would I shell out 50grand to get my entitlement back? When I’mliving in a high-cost county, Rockingham or Essex, where you have enoughentitlement to buy a full on a twenty thousand dollar house with no downpayment. Am I gonna shell out, you know, you – So there’s a math. We have to do somemath to see well, Rick, I’m moving to Floridaand it’s the house I’m looking to buy is one hundred eighty-five thousand and I’mstaying down there because I want to raise oranges. Okay, that’s fine. Okay,don’t don’t pay $40,000 to get your entitlement back. When you’re gonna haveenough entitlement remaining to buy the house. So you don’t need to. So sometimesthere’s a, there’s no need to repay the government the entitlement that you lost.Every rare situation you might. Depends though and where you’re going where youbuy and if you’re gonna be in a high-cost County or you’re not gonna bein a high-cost County. [Paul]: You only, so with the new HR – I mean it’s a good thing but,at the same token, in the back of my mind it seems like you might end up with alot of situations where people like alright, if my first purchase I canbasically go unlimited and the secondary purchase is based on the actual numbersfor the county. [Rick]: Hmm [Paul]: then I might as well go big or go home the first time right?And that I mean, that’s potentially a really dumb decision. [Rick]: So, you know, if theydecide to go big go home the first time and buy a nine hundred fifty thousanddollar house with no down payment and then they want to try a buy anotherhouse. Their entitlements gonna be used up because they’ve – That’s a subsequentuse. They’re retaining their house that they just bought for eight hundredthousand dollars. When a under the new HR 299 bill, if a veteran retains a previousresidence with the VA loan. We revert back to the old way of calculatingentitlement remaining based on the county and loan limits. So, clearly therewouldn’t be enough entitlement left over for them to buy the next house. [Paul]: Right. [Rick]: Ifthey were able to refinance, which you have to look at the math, right? If I’mI’m buying a $850,000 two family in Boston, with no down payment, you’re notgonna be able to refinance that into a conventional loan any time soon. [Laughter] 15 years,right? So you, they’re not gonna be able torefinance that into a conventional loan or an FHA loan or whatever other typeof loan. They won’t be able to do that. So, there’s other there’s other some – There’s somechecks and balances in there that I just market driven, that are just – you can’t do it. So, but I mean what I like is HR 299 leveledthe playing field for you guys. I feel bad when a veteran in Worcester County,who did well, wanted to buy a six hundred thousand dollar house, but he had to puta down payment because it exceeded the county loan limit, right? Now, but you goone mile east into Middlesex County because they butt each other, right?[Paul]: Right. [Rick]: You go one mile east, that same veteran, or that a veteran similar incomesimilar everything else, he doesn’t have to put a down payment down because he’sin a high-cost County. I thought that was unfair. So, this elimination of the VA loan [limits, on first-time use or fullentitlement use, I think it’s fair. So, if a veteran did well and he’s living inPittsfield Mass and he wants a buyout because the right now the VA loan limitfor non high-cost counties is five ten four hundred. I think that’s the VA loanlimit. Five ten. So, veterans up North in Pittsfield, right? east osh migosh, wherever it is. Yeah, I’m making good money I want to buy a $600,000 house.Before January 1st, he couldn’t. He couldn’t put in – he’d have to put moneydown. Probably like 30 40 grand and now he doesn’t have to. And it’s the same forthat same person buying in Essex County or Middlesex County. So, I thought thatwas fair. I thought that was a good way to kind of level the playing field. Makethem all the same. [Paul]: So, you’ve kind of touched on this in the previousanswer but, so on a first home purchase using a VA home loan, the veteran canexpect to, as long as they have appropriate income and everything else,to make a purchase as large as the lender will actually give them? [Rick]: Correct.[Paul]: But on subsequent purchases and all that kind of stuff, the threshold for aveteran is – What, what’s the range? Like four hundred to six hundred thousand?I mean just, I mean – Let’s, let’s look at a not high-cost County and then ahigh-cost County – What could you expect?[Rick]: So, the a veteran buying a house and you know, with – So, a veteran who – So, are we talkingabout a veteran that currently has an outstanding VA loan and like what couldhe buy retaining that? [Paul]: Yeah. [Rick]: Compared high-cost County, non high-cost County? [Paul]: Yeah. [Rick]: So, hey you know, it could be pretty significant because the differencebetween non high-cost county loan limit, like Worcester county, that WorcesterCounty five hundred ten thousand four hundred. That’s the, that’s the loan limitfor conventional type financing. Which is what VA will use. In Essex County, it’ssix ninety one hundred I think it’s $190,000 difference. [Paul]: That’s insane.[Rick]: That’s the difference. So, not all states are the same way. [Paul]: That’s the difference of an actual condo.Like wow. [Rick]: So, if a veteran, that’s why it’s really, that’s why a lot of veterans areable to buy more homes. if your PCSing from like Podunk, like West Virginia, andyou come, that’s not a high-cost county right? And you bought a house in WestVirginia for like 80 grand. But you’re moving up to Boston. You can obviouslybuy a bigger home and you’ll have greater ability because the VA loanlimits so much higher. Nantucket, Martha’s Vineyard, I think that’s, that’s DukesCounty, that’s the other one. That’s like 736, Essex County is, yeah. [Paul]: Holy smokes. [Rick]: So,if a veteran who has an outstanding VA loan in Middlesex County, but is movingto a high-cost county, Essex, Middlesex, Duke, personal, Norfolk whatever -They’re gonna have thirty five percent greater buying power because five tenfour hundred in Worcester. Six ninety and change in Essex. That’s the difference. [Paul]: So,it’s, so it’s definitely easier going from a low cost to high cost the to a low cost to a high cost. [Rick]: Correct. So, [Paul]: So, you’re going from a high cost of low cost. [Rick]: You couldbe in problems. [Paul]: You just want to sell your property be done with it. [Rick]: A hundredpercent, right? Because if you’re going – So let’s say your, I’ll use a perfectexample, Coast Guard Boston. Guy buys a six hundred thousand, six hundred fiftythousand dollar home – No downpayment. Right. [Rick]: Goodyou’re done right? Time to time to PCS right? And you’re gonna go to New Orleansright? That County loan limit down there’s five ten, four hundred. You’ve used all ofyour entitlement in Boston. [Paul]: Right. [Rick]: You’re not using your VA loan at all in NewOrleans to buy a house down there. You can’t. You don’t have enough entitlementremaining. That jar is empty. Remember that jar we’re talking about? [Paul]: Right. [Rick]: A jar’s empty.So, either – A you sell that house back in Boston and get your entitlement fullyrestored or B, if you’re able to refinance that, before you leave into aconventional loan and then request the restoration of entitlement when you’rewhen you’re ready. So it yeah. Going low count you know, going normal thehigh-cost is easy. Going high cost to normal, not soeasy. [Paul]: Good information. [Rick]: mm-hmm yeah. [Paul]: So, every lender, with regard to a VA homeloan, every, every lender that’s out there pretty much can do a VA home loan. [Rick]: Yep.[Paul]: Right? [Rick]: Some choose, some some choose to, some choose not to. [Paul]: So, how how do I putthis nicely, a PC way – How do you know, or how does a veteran know that they’re notgetting screwed? They’re not getting the used car salesman pitch from [Rick]: Yeah. [Paul]: I meanwhat kind of things should a veteran be looking for or? [Rick]: Yeah, so, there’s reallylike there’s a lot of things I’d love to say right now, but I can’t. [Laughter] Shop yourmortgage. Do not you know, do not bite so to speak on that very first interaction,all right? I do a lot of lending in different states. So, I’m not going to sayworking with a lender that’s online like is bad. I’m saying that there are someonline lenders that are really really bad and that don’t treat veterans theway that I think that they should be treated. They treat them as a transaction.Not as a relationship, okay? So, there’s a difference. Veteran, you needto understand one thing. The VA home loan okay, little secret sauce for you guys,the VA home loan itself, is the most profitable loan a lender can originate.Makes them the most money. Makes them the most money. [Paul]: Why, why is that? [Rick]: Well, it has to dowith the, so, we’ve all heard of Fannie Mae, you know, Freddie Mac and Ginnie Mae.So Ginnie Mae is what securitizers, VA loans, FHA loans and USDA loans. They’recalled Ginnie Mae coupon one, Ginnie Mae coupon two, custom Ginnie Mae coupons,pools, we call them and they pay the lenders very well because of the federalguarantee that VA issues. A twenty five percent loan guarantee, right? [Paul]: Mm-hmm. [Rick]: So,lenders can make a lot of money on VA loans. Veterans unfortunately, a lot ofour listed personnel unfortunately, may not have the highest level of financialliteracy or understanding when it comes to buying a house, right? So, when you havea really profitable product, you have a demographic of consumer who may not knoweverything that they should know, right? About what it is that they’re trying todo. That makes occasionally for an easy target.And so therefore You know, easy targets they, they like togo after you guys. So, through all you know online solicitation. If it hasany veterans that are watching this, guarantee you, if you have a VA home loanyou’ve been bombarded with paperwork and in mail about the equity bio program oraccess your equity now through the US government’s brand-new system. They’lleven use logos that look like VA. It’s not. They’re not allowed to do that bythe way. So, if you get a letter stating that, and it looks like the VeteransAdministration seal is on it, do me a favor take that, crumple it up, put it inthe circular file. That is illegal. [Laughter] Can’t do that. So,veterans aren’t easily, in my opinion, easily targeted demographic when itcomes to VA home loan purchasing, okay? And refinancing. That is the reason whythere’s been several bills that have changed the VA cash out refinancingguidelines. The VA streamlined refinancing guidelines.Those two wentthrough major revisions in 2019 because, pardon my french, of scumbaglenders out there that have been taking advantage of veterans for far too longand systemically and habitually refinancing them every six to ninemonths. Bang-bang-bang. Every time. So all the regulations changed. So what I wouldsay is this – If you’re a veteran and you’re looking to work and you’relooking to get a VA loan – Online is gonna, is going to be an area that you’regonna be more susceptible to scumbags, okay? It’s just doesn’t mean you won’tfind a good one, it just means it’s gonna decrease your chances of success, okay?Work with a, if you can find someone that’s local, that understands thebenefit, right? That’s, that’s that’s your first choice. That’s a good choice.Interview the mortgage professional that, that you’re planning on working with.Like how long you been in business? How many VA loans you do. If they’re likeoh I do a lot, right? It’s you know, There’s a little, there’s a great websiteyou can go to it’s called NMLS consumer accessand you can actually look up me, as a mortgage professional, and see how manylenders I’ve worked with. How long I’ve been in the business. What states I’mauthorized to originate in. You can look up my entire history. So, if you go onlineand you interview your loan officer and you’re like, oh how long you’ve been inthe business, I’ve been in a long time. Go to the consumer access page and if he’sonly been in the business two or three years, he’s fos, right? [Paul]: Yeah. [Rick]: So, interviewyour loan officer a mortgage professional. How long you’ve been doingVA? What’s your experience? Do you charge discount points? do you charge loanorigination fees? You know, do you have, are you a direct endorsed lender? Do youhave the ability to underwrite direct for VA? Do you – This, there’s things that youcan ask to kind of figure it out because there’s too many mortgage – All right.Massachusetts only six point seven percent of our veterans use their VAhome loan benefit. [Paul]: What? [Rick]: Thirteen point seven percent nationally. [Paul]: What? [Rick]: That’sfact. [Paul]: That’s crazy. [Rick]: Yes. Currently of thecurrent, that doesn’t mean that’s who’s used it in historically, that is at thispoint in time, at this point in time, however many veterans millions ofveterans in the U.S. At this moment in time, only thirteen point seven percentof the veterans in the U.S. currently have a VA loan outstanding. Fact. Fact,Massachusetts has roughly three hundred eighty thousand veterans plus or minusat any given time. It fluctuates, right? You know that as well as I do. Currently,there’s only about twenty-seven thousand active VA loans in the Commonwealth ofMassachusetts right now. Fact. [Paul]: That’s crazy.[Rick]: Ballpark, yeah. So, I dovetail into if somebody goes, oh I do a ton of VA. Youask any loan office of that – They’re all gonna say the same thing. But the fact is -No they don’t because only six point seven percent of the veterans are usingit. So, if everybody says they do a lot – they don’t. You have to be very specificabout how you interview your mortgage professional on the VA because there arescenarios, and unless you’re experienced with the VAhandbook 26-7, chapter 4, chapter 6 chapter 10 – If you don’t know it, youdon’t understand it, then you can’t create the story for the veteran. Then youcan’t get them into a home. It’s yeah. [Paul]: Interesting. [Rick]: Yeah well, I mean, it’s a veryniche, it’s a very niche orientated demographic to work with, okay? If I havea hard problem, I’m not gonna go to a primary care physician. I’m gonna go to acardiothoracic surgeon to check my heart, right? If I got a headache I’m not gonnago, I’m not gonna go to a podiatrist. Let’s get my foot checked [Laughter] Yeahright? There are very few, there are very very, very few mortgage professionals inNew England that originate VA loans on a regular basis. That I know for a fact. So,you guys are, you guys are forced to do a little bit more work than most when itcomes to due diligence wise. There are a lot of online, there are a lot of bigcompanies that have really cool names I could you know, without saying names, theygot really cool names and you – A lot of veterans want to go to that because it’slike, ah you know? In my opinion unfortunately, those situations are justbringing the moth to the flame. So you have to do some research. That’s PC as Ican get. [Paul]: Do your research. [Rick]: Do your research, yeah, because it’s anincredible benefit and that’s another thing too is – When I train people, I trainloan offices mortgage officials across the country. I teach them, I go listen,this is not a loan program. This is not you know, this is not Fannie Mae orFreddie Mac. Which can change the regulation the rules instantaneously.This isn’t, this isn’t a loan program. This is an actual CFR, USC, federalbenefit, that these men and women earned. So don’t treat it like a program. It’snot a transaction. So, I try to tell loan officers, when they’re that, that arepassionate like I am about working with military – You’re not aloan officer. You’re not a loan consultant. You know, whatever. You’re abenefit administrator. Treat it as such. If you do a crappy job, just don’t workwith veterans. [Laughter] Go, go work with somebody else. [Paul]: Go do something else. [Rick]: Yeah, they tellthem straight up too and they’re like no Rick, it’s okay. I’m like, okay. We’ll see.Yeah, we’ll see. [Paul]: So we’ve, we’ve covered a lot of stuff in this podcast. We’vecovered who qualifies and how to get a Certificate of Eligibility and you know.The different ways that a VA loan can be used, as far as what it can purchase andamounts and FICO score and a lot of stuff.What are – Beyond all that, good grief, I’m going to have to have you come back onman. Beyond all of that, what are some of the, just like quick ones that you canthink of, what are some of the myths or misconceptions about VA home loans? [Rick]: Good.[Paul]: What you run into all the time? [Rick]: Ah they’re not free, okay? So, VA loans are not free. So, whichmeans, yes you can buy it. So, no down payment and there’s no private mortgageinsurance, but, nothing in America is free, right? So – [Paul]: You can’t even die for free.[Rick]: Right? [Laughter] you can’t, you can’t even die for free.No – There are closing cost – settlement charges. You are going to need money tobuy a house, even though there’s no down payment, you got to have some money. Now,the nice thing about VA, is VA really lets you get the money from any placeyou want. Unlike other loan options, Fannie Mae,Freddie Mac, FHA – Those guys have specific regulations on how you get assets topurchase properties for you know, gifts not gifts, whatever. When your – Everystate is different, the procedure for purchasing a home. Massachusetts. Ifyou’re gonna buy a house in Massachusetts and use your VA home loan,you can’t go to make an offer and say I have no money. The seller is going towant a deposit from you to take that house off the market, right?[Paul]: Okay. [Rick]: You got to have it’s called a good faith upon. You gotta have some skin inthe game for that. It’s not a down payment.That’s a deposit. [Paul]: Just to show you’re serious. [Rick]: Yes, now I do get a lot of timesveterans like, well Rick, I have no money. I have nothing in the bank and I want tobuy a house. Mike okay, we can do that it’s not easy. There’s a you know, it’seasier if you’re like Rick, I got five to six thousand saved up or seventhousand saved up, or I’m gonna cash out a 401k. it’s only got like ten grand, orsomething like that and that gets easier. But, there are always closing costs. Thereare always tax and insurance escrows that we have to collect at closing. So,there’s going to be a cost of buyout. So, VA loans are not free. [Paul]: Okay?. [Rick]: So we’regonna have some money. Now, what’s really cool is the VA is like, I’ve had thishappen before, the veteran needed some money to close. He went to the ATM usescredit. I don’t recommend this by the way, but he did it. [Laughter] He took out a $6,000,$7,000 cash advance against a credit card. [Paul]: Oh man. [Rick]: To pay his closing cost to buythe house and all we had to do was debt him for what that monthly payment wasgoing to be on the credit card. Now that he took a six thousand dollar cashadvance. Which at 23.9% was probably like 250 bucks, right? [Paul]: That’s a lot of money. [Rick]: But he boughtthe house. He’s like Rick, I’m gonna you know, whatever. I mean it worked, right?Don’t do that by the way. It’s not a good idea. So, you could never do that with aconventional loan or an FHA loan, a USDA loan. So you’re gonna need some money. Soyou gonna have, I recommend try to have as close to ten thousand saved up foryour deposit, possible settlement charges. If you don’t don’t let it, don’t letit dissuade you from trying to buy a house. Come in and talk anyways cause thenwe can work around like alright, I can call the seller. Like listen, this guyis a phenomenal borrower. He just, he’s cash-strapped.There’s ways we can work around that but, do you want to make it easier?You gotta have a deposit and that’s just to take it off the market and show goodfaith, right? So, that’s number one. So, that’s the – There’s always gonna beclosing costs and settlement charges. VA loans take a long time. No, they don’t. We’regonna be closed in a couple of these in 27 days. So, it doesn’t take a long time.If you know what you’re doing. [Paul]: Seriously? [Rick]: Yeah. It’s not, it doesn’t take a longtime. We try to hold everybody accountable.Myself, our team, the real estate professionals, the attorneys and theveterans. So veteran that does this, Rick, I’ll get you everything within 24 hoursthat you need. Okay, that’s fine. Those can call pretty, those those canclose pretty fast. When you have a borrower that is flighty,somewhat all over the place, and you’re like can I have 30 days of pay stubs?Sure, sure, sure. I’ll get them to you and they’re from like 2018. That’s not gonnawork, right? True story. I don’t reckon I’ll keep my pay stubs.Everything’s like direct deposit. I understand that. I need proof. How do Iknow you still work? Well you know I’m there. I mean I’m there every day Rick. Iunderstand that. But you throw out your pay stubs and you throw out your bankstatements. So what do I have to prove that you work and you have money? [Paul]: Right.[Rick]: Right. So if that takes three weeks to get, then you’re not closing in 21 daysor 27 days. That’s a 45-day closing. So be is -Holdyours – You’re gonna hold me accountable to domy job. I’m gonna hold you accountable do your job. So, if I give you a list ofitems again and it says two months bank statement, most recent of 30 day pay stubs,don’t give me pay stubs from December. That doesn’t mean anything for me. [Paul]:You’reright. [Rick]: And then you’re gonna get mad I because I’m going to be like, I need updated pay stubs. Ialready gave them. To that, it’s like we don’t like to do that. So, but they don’ttake long. So they don’t they, don’t take ong. This is another podcast but theproperty’s gotta be perfect condition, Rick. And we get thisall-time. No it doesn’t. Property does not have to be perfect condition. [Paul]: Yeah I’vehad some, I’ve had some guys tell me, and I don’t know if it’s true or not, becauseyou know sometimes people want to save face and come up with a reason as to whythey didn’t qualify for something, or whatever the case may be, but I mean I’veheard individuals say that, you know, there was, there was a shed on theproperty and the paint’s peeling and like maybe the gutters hanging down fromit and yes, the shed might not be in the best condition, but the house itself isin great condition. So, I mean, would that actually really stop somebody or keepthem from being able to use a VA home loan? [Rick]: So, when the rate of the regulation reads,yes. That the regulation reads, yes. So, but, here’s the thing – The VA appraisalprocess is designed to protect the veteran in the family and they look atthe 3 S’s – Safe, sound, and sanitary. And they want to make sure that the propertymeets the minimum property requirement. What we call MPR’s for VA, right? Yourexample, that’s any parcel, any structure on the parcel of property has to meetthe NPR’s. So, a shed that is peeling paint could be a problem, but has thatever in my 18 years been a deal breaker? No. And how many sheds have I had thathave been problems? Probably what a dozen. So how do we fix it? Well a couple ways.You could, ask to sell it or to repaint it. Sometimes they do. Sometimes they won’t.Tell the seller, hey, listen I don’t want that shed. Could you knock it down for me?Sure. We can do that. More often than not, sell is like, I’m not doing anything, thisis, we’re selling this house as is. That’s good, all right.I can’t tell how many times I’ve had veteran, my clients, go out to the house,now provided, this is after we’ve figured out everything’s fine. There’s no incomeproblem. No asset problem. There’s no credit problem. They can close. The onlyissue in this house is that you got a shed with a guyto raise freakin chickens, that’s now peeling paint. So, we get anindemnification letter from the seller, from our veteran, which means he’s notgonna sue anybody. Veteran goes out there on a Saturday, sand, scrape, repaint, praysit comes back – We’re good to go. We close fine. So, the veteran can take care of anyrepairs on the property that he, she he is see – he as she, sees fit to repairthemselves .Not a big deal. So, it’s not you know, I’ve done that for fences. I havedone that for sheds. Done that for decks Usually, if there’s a safety issue like amissing handrail that’s the seller, we will take care of that. In New England, in myexperience, the biggest issues that veterans will run into when purchasing ahome – I mean New England’s old homes, right? [Paul]: Yeah. [Rick]: It’s where America started, right? [Paul]: Right. [Rick]: I mean revolutions here, the Plymouth Rocks here. I mean just inDanvers Mass alone we have, I think 15 first, first period homes.It’s like 1600s, right? So, we have old homes. So, there’s a lot of peeling paintoccasionally, and there’s homes where they have staircases that don’t havehand railings. Just put them on. Piece of cake. Not a big deal and I’ve only hadone property in the last five years that just would not qualify and the sellerwouldn’t pay for and it was just too much work for the veteran to fix it up.Had like a roof was sagging and it looked bad and [Paul]: Yeah. [Rick]: And the guys likeyou know, the roofer came out, he’s like, I [gotta, I gotta be honest, he’s like, thiswhole thing’s got to come off and the veteran was like, I don’t. But that was, that waspicked up by the appraiser. But it doesn’t happen often. So, they don’t,if you’re a veteran out there, don’t freak out. You know, they have to buy newconstruction or a brand new home or whatever. We financed the house one time,it was an old 1965 Cape and literally the kitchen had not been updated. It wasold. Like pink tiles and green floor and you know, horrible cabinets and whatever [Laughter]and um – It was fine. It’s, it’s functional. So, it’s okay. It’s just it’s old. [Paul]: It’ssound and safe. [Rick]: It’s sanitary, yeah. you know If you get a, if you’ve got a privatewell, you got to do a well test. Make sure the why – I mean why would you not, right?There do you get – [Paul]: Yeah, I’d want to make sure right drinking waters was okay. [Rick]: Justwant to make sure the waters okay and doesn’t have like loaded with e.coli orfecal coliform or gas because there’s an upgrade, upgraded gas station somethinglike that. So, you don’t have to worry about you know, appraisals are not -It’ssomething that we have to just cross that road when we get to it. But it’s gonna benot a deal-breaker most of the time. Sellers have a hard time accepting VAbecause of rumors. So you know, but what most veterans don’t know, MassachusettsGeneral on chap the 151 b section 7, you guys are a protected class. So it isillegal in the Commonwealth of Massachusetts and five other states todiscriminate against a veteran on the sale, lease, or purchase of a property.Can’t do that and I’ve used that. [Paul]: Interesting. [Rick]: Mmm-hmm I had a 2018 had aseller say we’re not accepting this offer. I go, why not? It’s VA. So? Well wehad a bad experience last year so we’re not accepting any veterans, any VA offers.You can’t do that. Yes we can. So, I politely send over the, the Massachusettsregulation, the MGL. Sent it over there. That’s only for disabled veterans. Noit’s not. We’re still not accepting the offer, okay? So I called up the realestate professional I said, so here’s what’s gonna happen,I go either, A, you accept the offer and we move on and we close to this veteran,or B, I file at MCAD violation against you and your seller and I had, I had aconsumer protection attorney agree to file a list pendents on the house. To tie itup in litigation so they would never sell itand then I will actually file to have your license removed under adiscrimination violation with the Massachusetts Association of Realtors. Weclosed 30 days later. It’s good. It doesn’t mean a seller has to acceptthe veterans offer. That doesn’t, that’s not what I’m saying.[Paul]: It’s just that you can’t discriminate against them for. [Rick]: And this was in writing.The PERT the the seller said in writing no VA offers allowed and because theonly, because veterans are the only ones to get the VA, it’s a litigate ableoffense. Based on my conversation with a consumer protection attorney, that denialof a VA benefit indirectly discriminates, directly discriminates a veteran becausethat’s the only, that loan option is only available to you. [Paul]: But that is not to beconfused with a property that does not qualify for a VA Home loan. [Rick]: That’s Correct. That’s right. So,I mean, if it doesn’t qualify doesn’t qualify and the seller does not have, tounder any pretense whatsoever, bring that property up to code in any way shape orform. It’s simply the bait the, the, the, the factual raw discrimination of sayingI’ve got a veteran highest, best highest best offer. No other offers you know,whatever it is and I’m just not going to take it because it’s VA. That’s what I’mtalking about. And we run into those once or twice ayear and it’s like I said, when when we, when we show them the regulation – that’sit. There’s only this five other states that have veterans is a protected class.Which is really ,which is a really, awesome. So um, I mean, there’s a few otherthings that are – Can’t buy condos. Or you know, we already talked about that. But you know,condos don’t take 90 days or 120 days to get approved. You’ll hear that a lot. So,if a lenders – This is one way you as a veteran you can kind of vet your lender.If the lender is like, oh don’t buy the condo. It’s gonna take six months againreproof. Walk away. Just turn around walk out. Call it a day. Put a flag and youknow pin that with like – not go see that person again. [Paul]: Right. [Rick]: We just got acondo approved in 11 business days. [Paul]: That’s a, that’s a proactive group of people. Bothbuyer and seller. [Rick]: Yeah you know, the seller -We knew the condo association, we reached out. They were very proactive and got usthe stuff that we needed very quickly. Our team got it in very quickly andCleveland Region Loan Center approved it very quickly. So, on average does thatdoes it, does it, is it 10 business days? No, it’s usually about 14 to 15 businessdays. You look at like two and a half weeks. But it’s not six months. It’s not90 days. You know what I mean? So, condos are a great affordable opportunity forveterans and I highly recommend that they do not limit their search to justVA approved condos. Especially when you’re working with professionals thatknow how to approve those loans, or prove those properties. So, there’s, there’s alot there’s a lot of wiggle room in there too. Veterans uh, what’s another onethat’s a big myth out there – Well the seller has to pay the pest inspection.That’s a good one. That’s it. So, you get [Rick]: this a lot. This is part of the reasonwhy they deny. They don’t want to accept the offer. If you have a lender that says,oh the seller must pay the pest inspection. Just walk away. Just gosomeplace else. That regulation was changed in May of 2014 and by the way,the regulation never read the veteran that the seller had to pay for it. Theregulation used to say only the veteran was not allowed to pay for the pestinspection. Somehow, common-law, whatever the real estate industry decides to makeit like the seller how to pay for it. So, that was changed five years ago. Sayalmost six years ago now. [Paul]: So, there’s a lot of myths out there. Dude., I’m gonnadefinitely have to have you come back on. We’ve covered a lot of great information.[Rick]: Yeah. [Paul]: I really appreciate it. I appreciate what you’re doing to you know, help outthere veterans that are doing this probably for the first time in theirlife. You know, purchasing their largest purchase they’ll ever make and, andkeeping them on the straight and narrow make sure they’re not getting – [Rick]: You know,for me, is someone that comes from a real patriotic family and you know, I getreally emotional sometimes talking – When I teach in front of people about why Ido what I do and I’ll tell you, for those, if there’s a mortgage professionalwatching this or a real estate agent that watches this – I firmly believe in my heart – This is one of the few ways that we can actually give back to ourmilitary and help repay a unrepayable debt, right? There’s no – I don’t thinkthere’s any other way I could repay a veteran for their service, combat andnon-combat Air force, whatever was, I’m helping them use their benefit. [Paul]: Right. [Rick]: It’s thebest way for me to give back and say thank you and do it right and provideinformation and guidance and impartiality and so, I – For me it’s justawesome. [Paul]: Oh, Rick – Thank you so much for being on the podcast. [Rick]: It’s greatbro. [Paul]: Definitely have you back. We got can get in the weeds on a couple ofdifferent things. [Rick]: Yeah we have lots of stuff that we can kind of deeper dive on things and wecould you know maybe some podcast pick one thing like, hey, let’s talk about30-minutes Rick about this, right? Do some flowcharts or whatever [Laughter] [Paul]: Alright man.Well I appreciate it. [Rick]: Thanks brother [Paul]: To all you guys out there – If you’re lookingfor information, if you want to get in touch with Rick, asking some questionsthat maybe we didn’t cover during this podcast – Again his information is down inthe description. Feel free to reach out to him via email or LinkedIn or whateverthe case may be. All that info will be there. Rick, thank you. To the audiencethank you. [Rick]: Thank you everybody for everything. Appreciate it. Yeah man. [Paul]: We’llsee you guys the next podcast.