VA Vendee Program Offers 5% Down Financing For Investors

VA Vendee Program Info & Questions:

VA Vendee Financing Program offers 5% down financing for Real Estate Investors, and is now administered by the Bank of America.  It used to be called the VA Repo, or OCWEN program.

I’m in the middle of qualifying for a VA Vendee Financing Program, AKA Veterans Administration Vendee Financing Program.   I bought a number of homes with the VA Repo program in the 90’s, when they were 0% down, but this is my first time going through the Bank of America VA Vendee Financing (they won the contract from OCWEN, who stunk because I was never able to register with them).

VA Vendee ProgramI loved the program in the 90’S, and I loved getting rental properties with No Money Down that cash flowed immediately.

There are good and bad reviews about the VA Vendee program.   Personally I don’t care, because 5% down for investors is a great financing option (of course you have to qualify for it), but do any of you know of pitfalls to watch out for when going under cotract?

Here re some good and bad posts about the VA Vendee Financing Program:

Are you kidding? this program is awesome for investors!!

5% down, and a 4.5% rate of the _entire_ 95% of the balance!, no PMI either folks, cha ching! Up to 6% towards closing costs. No appraisal. No # mortgages limit. Seasoned investors can even use 75% of appraised rent for the property being bought towards calculating debt to income ratio. Still need convincing?

The VA fee is 2.25% which is 100% deductible in the first year as qualified mortgage insurance. It’s basically prepaid PMI and because its VA its “qualified”.

BoA charges a flat $2500 for closing costs and VA wont pay title policy so don’t bother asking.

The quality of the properties seems to be much better than the average foreclosure in my area. I just closed on one with no deferred maintenance and got it rented in two weeks. I am closing on another this coming week that needs just a couple grand for cosmetics.

The closing process is a bit of a brow beating as far as documentation is concerned. I swear I thought they were going to ask for my first born too. But I guess that is par for the course now giving the new lending market risk aversion.

As another poster mentioned they are real miserly on coming down on the price. I’ve found that by being patient and waiting until the first price adjustment (usually around 3 weeks on market) then coming in 3-6% below usually seals the deal. Don’t freak out if someone else beats you to it. About half the contracts these days are falling through so you’ll probably get a second chance.

I have found that a property with these financing terms cashflows easily. I’ll continue to snap them up as they come on the market


I am working one right now and it is a BITCH. The closing costs are huge. You need to buy it in your name then have it transfered to an LLC as they will not loan to an LLC.

I am dealing with Bank of America and they are not moving an inch on the price. It has been on the market for 90+ days with no price reduction and they will not go less than 6k lower than asking on a 160k property. I think they think that the loan makes the high price worth it?


For more VA Vendee Program Info, go to the next post called  VA Vendee Financing Program Facts & Data.

So guys, any personal experiences with the VA Vendee Program?

Other BofA VA Vendee Loan Program posts and Forum discussions:

  1. My VA Vendee’s Loan officer contact info –
  2. VA Vendee Loan program basics –
  3. VA Vendee Program for Investors –
  4. A great discussion forum from those who bought through VA Vendee Investor Loan Program –


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21 Responses to “VA Vendee Program Offers 5% Down Financing For Investors”

  1. Cindi Huculak Says:

    I am an agent in N.C. Writing my first vendee offer. My buyers need approx $3,000 from the VA. Where do I put the seller paid closing costs on the OTP under Term Offer? Is if best to offer full price if asking for closing costs? Thanks.

  2. Angella Raisian Says:

    You can put the statement: “Seller to credit Buyer with $3000 for closing costs” pretty much anywhere in the contract. Govt repos can be sold at 80% of the value, but the price you offer should really depend on how much competition you have. If there isn’t any competition – I would not make a full price offer.

  3. crystal Says:

    I am currently going through this process – a homeowner, not investor. Bank of America is being horrible about processing the loan. We need to close in 45 days, per the contract, and we will be lucky if we are close to that. The processor has had my paperwork for 3 weeks today and I have no idea if it has been submitted to underwriting. (Extremly poor communication) THe rate we got was fantastic and the no PMI was very attractive… however, I would have paid much more for not having to deal with this headache and the thought of us losing the house because Bank of America could not process in time. DON’T DO IT!! I’m not even sure where to turn right now and it is very disheartening…

  4. Angella Says:

    Wow! That’s not good. I wonder if that’s how the entire program works, or if it’s your bad luck with the loan processor.

    Probably the BofA i general. It took them 2 weeks to get me preapproved, whereas it took homepath only 2 days.

  5. crystal Says:

    Pretty sure BofA in general. I just talked to a different loan officer that said the Vendee’s were taking 40-60 days to close because they were so far behind. (WOuld have been nice to know from the beginning…) Now, we are worried we will have to pay a per diem for extending the closing… Nice little racket they have going…

  6. Angella Says:

    Yes, 40-60 days to closer a loan is something they should’ve disclosed from the start. None of the banks I know of have ever charged per diem for going past the initial contract date. Just request an extension, and if you can submit a letter from BofA stsing they are falling behind – even better. Good luck, Crystal!

  7. Angella Says:

    Cindy, how did your escrow turn out?

  8. Amy Says:

    We are going through the same thing. We started this process in late November,r pre-approval was instant. Than we made an offer, had contract, loan rep went on vacation for 2 weeks (she was WONDERFUL). The two loan officers that were supposed to be helping while she was on vacation were TRANSFERRED TO ANOTHER DIVISION. Come to find out my loan officer when she returned on 12/13 was transferred too! It is so disheartening. I spoke with the processor (finally after 3 weeks of NOTHING) and she reminded me twice she was inundated with work, had 35 files on her desk she hadn’t yet looked through. I demanded to speak to Supervisor, the supervisor finally called back 1.5 weeks later! And, she advised she didn’t receive W2’s, bank info etc that was faxed 11/27! So, refaxed this week (Tuesday), left 4-5 voicemails since then & nothing. She’s a supervisor & nothing! I honestly am beside myself. We HAVE to go through BOA for the VA Vendee properties, but it’s just not fair! We were supposed to close 12/29 now god only knows when we’ll close. I just need a target date, and no one is responding! I guess 20,000 loan officers were transferred to another division….thanks BOA for NOTHING!

  9. Angella Says:

    May be it’s time to threaten BofA with Social Media exposure? It worked with some airlines in the past. Get a campaign going…

  10. crystal Says:

    Amy, so sorry you are dealing with this too! After 3 weeks on the processor’s desk, we have finally been sent to underwriting, had more paperwork they needed 7 days later (new statements since it had been SO LONG since originally sending everything), and now we are back in underwriting. Doubt we will close before the end of the year. Honestly, I would start working on an extension just to be on the safe side – that’s what we did, and we needed it. I have pretty much done all of the legwork on the processing myself and triple checked my debt to income ratio with the processor before he submitted it. Good thing I did, as he had our current mortgage in there TWICE and we would have almost been over the limit.

    I did talk to a very nice loan officer (Mine was transfered), and he told me that the VA property managers have been told by Bank of America to give extensions with no questions asked… and if I had a problem to call him and his VP would call them for me.

  11. Sharron Clemons Says:

    Yes, 40-60 days to closer a loan is something they should’ve disclosed from the start. None of the banks I know of have ever charged per diem for going past the initial contract date. Just request an extension, and if you can submit a letter from BofA stsing they are falling behind – even better. Good luck, Crystal!

  12. Stefanie Says:

    I too have been involved in a VA Vendee transaction with BofA. Our loan has been with BofA since October 26, 2010. From the beginning the loan officer would not communicate with the real estate agents on our loan. We were told that we had submitted everything that was need to process the loan. The real estate agents and myself had called the loan officer several times only to reach his voicemail. Several messages were left with no response. The only way to reach this person was through email. Every question that was asked was answered in a vague sentence not really answering our questions. “Do you have everything you need”, “Is the file in underwriting”,”Are we scheduled to close”, etc. All with a simple response, “yes, it is” and that was it. The week before Thanksgiving we were told the loan was on track to close on-time. My agent followed up with the loan officer to get an update on the Monday of Thanksgiving week only to find that the loan officer was out of town and would not be back until the following week. Our loan was scheduled for closing on December 10th. My agents spoke with the back up loan officer and he told them that they were still missing the “motivation” letter. I immediately resent the “motivation” letter and it was acknowledged that it had been received.

    As the week progressed we were introduced to the processor who said that she was still waiting for the letter. Again, we sent the letter. After 4 or 5 times of faxing and emailing the letter they said that they had everything they needed.

    With our closing date approaching and still no response from the original loan officer, my agents called to get a supervisor and the supervisors, supervisor. Now the file had a an email response immediately. The loan officer responded. Again we were told that they had everything they needed. On December 7th I was told they needed another document that I had already sent. Keep in mind our loan is due to close on December 10th. The loan officer had told the agents that the VP was on the file and they were doing everything they can. Also, the file was to be sent to underwriting on December 7th. At that time, my agents decided it was time to ask for an extension. The loan officer told them “about a week” should be fine…they extended 10 more days as we were told again the file was in underwriting and would take 48 hrs. However, I received an email from the loan officer telling me he had told the agents that a week should be fine, but didn’t really think that was long enough. Then why didn’t you say so? On December 13th we asked for an update on the file and were told they were waiting on a verification of employment. Really?!? You already said the file was complete and now were are still waiting? Once again the agents and myself bent over backwards to get the VOE as soon as possible. Again, the VOE was sent and again the loan officer was out of the office. With his out of office response via email another name and number were presented to call if we had any questions. The agents called and a nice gentleman who believed in keeping the clients informed gave us some information that he believed he would get his “butt” chewed for disclosing. The notes in the file said that the file was scheduled for closing on January 2, 2011. The VA Vendee loans were behind and an underwriter had walked out on the job. He wasn’t sure if it was BofA or VA holding up the process, but there were some problems and we should ask for another extension to the 2nd of January.

    In the meantime, another loan officer had taken the file over. She said that the file was now in underwriting…wait a minute, we were told it had been sent on the 7th and it is now the 14th. Based on the information we had just received, we asked for another extension. Due to the New Years holiday, the county offices are closed on Friday the 31st so we need to close our file by the 30th.

    On December 23rd I was told that I need to send in updated bank statements and some other items, since they have had the file so long.

    Today is December 28th and we are still facing our deadline. We need the file out of underwriting today, still with no response from BofA. We are again facing losing our earnest money. BofA has been horrible to work with and one of my worst nightmares. I am only trying to buy a home. I wished I would have listened to my agents and went a different route for the lending. Lord only knows how this will turn out.

  13. crystal Says:

    Our loan was just approved yesterday. THis was the 3rd time our file was in underwriting, and the asset manager from the VA refused to extend past the end of this month. After the file was approved, she agreed to extend until the end of January. I wouldn’t even try to contact your loan officer. Talk to your processor – they are the only ones who really know what is going on. (If you can call it that!) I swear, this whole thing has made me a crazy person! Praying that we all get houses we are wanting!

    I did talk to a loan officer there though who told me the asset managers have been instructed to be VERY lenient with the vendee loan extensions. (the asset managers for the VA are also employees of Bank of America)

  14. Angella Raisian Says:

    Just curious – have you guys requested to speak to a Supervisor, and did that help at all? Above you mentioned that Supervisors are required to respond within 24 hrs. How about sending a nastygram stating you will hold the loan officer, and BofA, liable for the loss of deposit?

  15. crystal Says:

    I have talked to a couple supervisors. They were really no help either. Just said that they would make sure that the processor kept me updated (which he did pretty decently after that). Did just get a call that we were going to “hopefully” be closing on Thursday! OUr file was just approved last night. So, I guess after it gets through underwriting, it goes pretty quickly… it’s just getting there that is horrible.

  16. steve Says:

    I was wondering w/ the va vendee, what the earnest deposit is at offer. I’ve read everything from $500 to 3% and want to see if anyone can provide any insight.


  17. stefanie Says:

    Update on our loan. We did get an extension for January 18th. However, now our loan has been denied unless we go the “investor” route. We are not investors. I am disgusted with BofA. Their inability to communicate has caused us much grief. We have lost our earnest money and hope to never do business with them again.

  18. Angella Says:

    Do NOT sign escrow instructions to release your EMD. You will not lose it, unless you give it up freely. Escrow will not just turn it ov er, unless you authorize it.

    Call me if you want to talk, but we’ve never lost EMD, even if it was Buyer’s fault. No reason you should, either. Seriously – if you fight, Bank will just turn it over to you.

    Angella (310) 528-5789

  19. Ofir Says:

    Great program but expect each closing to be a battle!

  20. Angella Says:

    That’s it exactly! It’s a pain, but if you’re in no rush & don’t care – it’s a great way to leverage your $ at low interest rates

    Angella Raisian @ http://AngellaRaisian.con

  21. O.W. Says:

    The communication between myself and the loan processor at The VA VENDEE program has been a joke! When I finally did get ahold of a supervisor she was rude and said that it was not necessary to call her and that my processor had to take a few days off for an emergency. Anyhow, the closing is suppose to take place in 3 days, good luck! Also, the supervisor said she was going to have the processor contact me in this afternoon but off course I didn’t receive a call! They are miserable people working there and are overworked and understaffed, at least that’s what the supervisor made it seem like. Seems like a great program but the hassle/headaches of going through the loan process may not be worth it.

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