Many Sellers are reluctant to accept VA purchase contracts due to Old Wives’ Tales (OWTs).
Many years ago, sellers were obligated by VA to pay any buyer discount points and lender fees. This included ancillary fees, such as doc prep fees, underwriting fees and tax service fees. This is no longer the case.
Sellers are required to deliver a property that is free of serious defects, including active termites or termite damage. However, the buyer (at least in Florida) is allowed to pay for the WDO/Termite inspection report itself, subject to limitations.
The VA expects that any repairs noted by the appraiser that are required to meet VA’s Minimum Property Standards are to be paid for by the seller and completed before settlement takes place. It is not permissible to escrow buyer funds to pay for VA required repairs. This is because the repairs are included as part of the VA’s estimate of value.
The Veteran borrower can pay lender fees up to 1% of the sales price. In most cases this will limitation will cover most if not all lender fees, and this cap must include the cost of the termite inspection.
Florida Mortgage Experts 