Why military families struggle to compete in the housing market

WISCONSIN (CBS 58) – During the pandemic, the housing market exploded, but it became more difficult for veterans to buy.

Andrew Buczkowski retired from the military in August 2020 after 12 years of service. He married his wife, Stéphanie, a few months later.

In November, the couple learned they were expecting a baby girl.

“When we found out that Stephanie was pregnant, I was like we couldn’t live in an apartment anymore,” said Andrew.

The couple already have a 7-year-old son.

“It was important for us to settle down, for him to stay in one place, to put down roots, so that he could make friends,” said Stéphanie.

Roots that none of them have ever had.

“We grew up renting,” Andrew said.

Andrew and Stephanie have been pre-approved for a home loan in Virginia. It’s a program that allows vets to buy with no down payment, no private mortgage insurance, and lower interest rates.

“Honestly, that’s probably the biggest benefit the VA gives you,” Andrew said.

Chris Birk is the vice president of mortgage analysis at Veterans United, the largest VA purchase lender. He says last year was the biggest year for VA loans as more and more people look to buy.

In Milwaukee, in the first half of fiscal 2021, VA purchase loans increased 13% compared to the first half of fiscal 2020.

“The heart of this benefit was the idea that they forego the ability to create credit and savings to defend our freedoms,” Birk said.

But the market is competitive and in this competition the veterans are the losers.

“If you’re competing with conventional or cash products, the veteran is going to lose every time,” said Beth Jaworksi, real estate agent at Shorewest Realtors.

Jaworski has not worked with the Buczkowskis, but works with veterans. She says misconceptions about loans scare sellers.

“One of them is that because it’s a government-backed program, it’s going to take longer, which isn’t really true,” Jaworski said.

Birk says that 20 years ago these loans took longer, but not anymore. He adds in April, VA loans closed only four days later than conventional loans.

“The VA has invested so much in automation and technology to help VA loans compete better in today’s marketplace, and that’s why you see so many veterans turning to this advantage,” Birk said. .

Another thing that makes sellers wary is the review process. VA appraisers can issue work orders for things like peeling paint on the exterior and handrails. Everything must be repaired and re-inspected before closing. Many sellers don’t want to deal with it.

“It’s hard to hear,” Birk said. “We know this is happening in markets across the country. “

After several unsuccessful offers, the Buczkowskis were at an open house and realized what they were up against.

“Our real estate agent asked, ‘Hey, are you working with the VA home loan? ”, Said Stephanie. “And the salesperson’s agent was like, ‘ehh, we could do that. “And the way he said it, you can tell it wasn’t the most favorite loan out there.

They didn’t have this house either.

“I’m having a baby, which I think would be the biggest stressor, but it was the most stressful thing in my life,” Andrew said.

Jaworski says she has customers who are veterans and they’re just waiting for the market to calm down. She has another client who decided not to use her VA benefit and pay more.

“The loan officer was beside her, couldn’t we change it because it was costing her over $ 100 a month,” Jaworski said.

With the baby’s arrival in August, the Buczkowskis were on the verge of giving up and finding another apartment. Then they entered another house.

“I was just standing there and Stephanie came in and she was like ‘wow’,” Andrew said.

They decided to try another offer. Their real estate agent asked the sellers agent if he could write a letter. The agent said yes.

Stephanie sat down and began the letter explaining their situation.

“Dear owner, my name is Stéphanie. My husband just left the military after 12 years and is ready to raise our family in a house where he doesn’t have to worry about relocating and being uprooted, ”Stephanie wrote.

It worked. Their offer was accepted because the vendors are also a family of veterans.

“What we were looking for in a house and a seller is what they were looking for in a buyer, so it worked, but unfortunately not everyone will be so lucky,” said Stephanie.

Jaworski says it shouldn’t be that hard.

“I think realtors really need to come together to work with the federal government to do a little overhaul of this program,” Jaworski said.

She says it could include motivating salespeople.

“They can pay some closing costs, pay the taxes for the year, pay the title policy, do something that way,” Jaworski said. “Or do something with the peeling paint requirement.”

Birk says there also needs to be more education for civilians and real estate agents on how the program works.

“Not letting the veterans compete using their advantage seems like a disservice considering how much they’ve done for us,” Birk said.

Meanwhile, Andrew and Stephanie have just moved into their new home and are preparing the nursery. They are delighted to give their children something they never had: a place of their own.

“It’s kind of like that American dream,” Andrew said.

About Mallory Brown

Check Also

Mortgage Holders Pay Hundreds More As Interest Rates Rise

In just a few months, Lauren Gilbert says her monthly variable rate mortgage payments have …

Leave a Reply

Your email address will not be published.