Eric is an eligible Veteran who wants to buy a condominium unit using VA financing. The unit is in a project that has not been approved by the VA. What is the key financing issue?
Correct Answer
D) VA financing may not be available until the condo project is VA-approved
VA guidance explains that a borrower can use a VA-backed purchase loan to buy a condo only if it is in a VA-approved project. Eric's personal eligibility alone is not enough if the project itself lacks the required approval.
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Related Topics & Key Terms
Key Terms:
Related Concepts
RESPA is a federal law that requires lenders to provide borrowers with information about settlement costs, prohibits kickbacks and referral fees, and limits escrow account deposits. It applies to federally related mortgage loans.
The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
TILA is a federal law that requires lenders to disclose the true cost of credit to borrowers, including the annual percentage rate (APR), total finance charges, and loan terms. It is implemented by Regulation Z.
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