As the U.S. wages its ongoing battle against COVID-19, millions of Americans who helped fight the country’s more conventional wars are turning to mortgage professionals to help them move on to the next stage of their lives: homeownership.
According to Rob Posner, CEO of veteran-focused NewDay USA, originators have an obligation to support the country’s veterans, many of whom continue serving the community as policemen, nurses and firemen when they return home.
“They’re wonderful people to work with every day,” Posner says.
Originators unfamiliar with lending to veterans may be wondering just how challenging it is to get them into housing. Few news stories touch on the successes veterans have when returning to life in America, concentrating as they do on widespread mental health issues and homelessness. Even recent stories about the USPS’ recent struggles obliquely refer to the thousands of veterans who could lose their jobs.
But Posner says many veterans come to the table with robust incomes bolstered by military pensions, social security and VA disability pay. Older veterans who entered the private sector after leaving the military are frequently supported by private pensions, as well.
“The quality of a veteran’s income is, by far, the most stable income that you’re going to find in any asset class of mortgages today,” he says.
The challenge, then, is ensuring vets have enough capital at their disposal to make a down payment and cover closing costs. Posner says that kind of assistance takes several forms, from formulating a savings roadmap for clients to providing them with down payment assistance programs.
Veterans can also ask sellers for price concessions of up to 6%, a critical discount that can allow them to cover their closing costs. Getting sellers to shave even that much off their asking prices may seem unlikely under COVID-19, but Posner says they have been “very willing to give it” when clients show up with their funding already approved.
For older veterans concerned by the health risks posed by COVID-19, originators need to put in place methods for closing deals that don’t endanger their aging clients’ lives. Posner says NewDay has instituted an almost hands-off closing procedure which, for documents that must be signed in person, sends a gloved and masked notary public to the buyer, who is then walked through the closing documents over the phone.
“It’s incredibly simple. It’s 10, 15 minutes and the veteran never leaves his house,” says Posner.
Strategies and products aside, Posner feels originators should be most focused on the one thing all veterans understand: service.
“Just do whatever you tell them you’re going to do,” he says. “They’re honorable people. They want good service and they want the truth. If you give them that, you’re going to be fine”