How FHA and VA Financing Affects Your Offer
If you are obtaining a VA or FHA loan in order to finance your home purchase, you must include that information in your offer. This is because government loans place additional financial and performance obligations on the seller.
FHA and VA appraisals are also more strict and potentially costly to a seller than for a conventional loan. The inspection may reveal certain items the seller is required to repair or replace that would not be required in a standard real estate transaction.
First, VA and FHA loans prohibit buyers from paying certain types of fees that are often charged by lenders, escrow companies, settlement agents and title companies. They are called “non-allowable” fees. The result is that the seller ends up paying them instead of you.
Since these are fees the seller would not pay on an offer with conventional financing, this information must be included in your offer. You should also realize that since the seller will be paying these additional fees, they may be a little less negotiable on the price.