Fact: California VA Loans Usually Don’t Take Longer to Close

Surveys have shown that some military members and veterans believe that VA loans take a lot longer to close, when compared to conventional mortgages. But the truth is the average processing time is nearly identical for both types.

The VA mortgage program also provides benefits you can’t get from a conventional mortgage, like the ability to avoid making a down payment. That’s a pretty big deal in California.

1. In California, VA loans often close just as fast as conventional (non-government-backed) home loans. The average closing time is about 44 days for both types.
2. The idea that VA loans take much longer to close is a common misconception. Data from the Department of Veterans Affairs and other sources shows it’s not true.
3. VA loans are actually more likely to reach the final closing stage, when compared to conventional and FHA loans. This can be reassuring for both buyers and sellers.
4. Borrowers can help keep things on track by staying organized and responsive. This means communicating regularly and responding quickly to any lender requests.
5. The government has modernized its systems over the years to speed up the loan process. Today’s VA loan process is much more efficient than it was in the past.

Important Terminology Being Used Here

Before we get to the myth-busting part of this article, we should cover some of the basic terminology being used here:

• VA loan: A mortgage loan that receives a guarantee from the government, with oversight from the U.S. Department of Veterans Affairs. These loans are limited to military members, veterans, and certain surviving spouses.
• Conventional loan: A mortgage loan that does not receive any form of government insurance or guarantee. The “conventional” label distinguishes these fully-private-sector loans from the FHA and VA programs.
• Closing timeframe: Refers to the amount of time that passes between the initial loan application and the final closing. The closing is when the borrower signs all finalized documents and takes possession of the home.

Borrowers should also understand that VA loans are generated in the private sector, just like most other types of home loans. But they receive government backing in the form of a guarantee.

This guarantee gives mortgage lenders an extra layer of protection from financial losses relating to borrower default. But it benefits home buyers as well, by allowing them to buy a house with no down payment whatsoever.

California VA Loans Don’t Take Longer to Close

The U.S. Department of Veterans Affairs once published an article designed to debunk some of the most common myths and misconceptions relating to VA loans.

One of their fact-checks confirmed a key point stated above. On average, California VA loans do not take any longer to close when compared to conventional mortgage financing. In fact, the typical processing timeline is nearly identical.

Regarding the lingering myth that “VA Loans take forever to close,” the VA.gov article stated the following:

Fact: They close as fast as the others, and they’re also more likely to close than both conventional and FHA loans.

The VA’s researchers used mortgage processing data provided by Ellie Mae. This company, now known as ICE Mortgage Technology, provides loan processing software to the mortgage industry.

Their software is used to process the majority of home loans within the United States. So it offers insight into the average processing time and related metrics.

The researchers also determined that VA loans are more likely to close than their conventional counterparts, which is good news for both home buyers and sellers.

The Department of Veterans Affairs continues to modernize its technology and streamline its procedures. These efforts help keep the VA loan program running smoothly and efficiently.

How You Can Help Keep Your Closing on Track

As a home buyer, you don’t have direct control over every aspect of the VA mortgage lending process. But there are certain proactive steps you can take to help ensure that your closing stays on track.

1. Round up your financial documents early on.

When you apply for a VA loan in California, you will be asked to provide a wide variety of documents relating to your financial situation, employment, and income.

(This is true for all types of mortgage loans by the way, including FHA, VA and conventional.)

You could expedite the process and streamline the path to closing by rounding up some of these documents early. At the very least, figure out how and where to obtain them, so you’re ready to go when the time comes.

Commonly requested documents for a VA loan include pay stubs, bank statements, IRS W-2 forms, tax returns, and statements relating to investment accounts such as IRA or 401(k).

Many of these documents can be submitted electronically, which helps to speed up the process.

You will also need to obtain a Certificate of Eligibility (COE) from the Department of Veterans Affairs. You can request this document on your own, through the VA.gov website, or have your mortgage lender do it for you.

2. Keep the communication flowing.

You can also help keep the process on track by staying in close contact with your mortgage broker or loan officer.

Good communication is the glue that holds everything together. For instance, you could check in with your mortgage company’s point of contact throughout the process, to make sure they have everything they need from you.

You can also stay in touch with the escrow company that’s handling your closing, for the same reasons as stated above.

3. Handle additional requests in a timely fashion.

Borrowers sometimes receive additional requests from the mortgage underwriter before they are allowed to close. This is another area where you can take proactive steps to keep things on track.

The underwriter is the person who reviews all of the loan documents to make sure they are accurate and acceptable. The underwriter will also ensure that the borrower meets all mortgage guidelines for the VA loan program.

If you receive a request for additional information, handle it in a timely manner. This will help you reach the final closing stage, while avoiding unwanted delays along the way.

How Bridgepoint Funding Can Help

If you want to use a VA loan to buy a home in California, we can help you every step of the way!

Bridgepoint Funding specializes in VA loans and serves the entire state of California. We enjoy helping military members and veterans in their quest for homeownership.

Here are some of the ways we can assist you during this process:

• Determine your eligibility for the program based on your military service.
• Request your Certificate of Eligibility on your behalf, to expedite the process.
• Pre-approve you for a specific loan amount to narrow down your housing search.
• Order a home appraisal to meet Department of Veterans Affairs requirements.
• Deliver all of your finalized documents to the escrow company for your closing.
• Answer any questions you have about using a VA loan in California.