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Power of attorney allowed for VA loans

VA will allow a veteran to use an attorney-in-fact to execute any documents necessary to obtain a VA-guaranteed loan. This enables active duty service persons stationed overseas, and other veterans who cannot be present to execute loan documents, to obtain VA loans. That seems fairly simple and straightforward enough, but there are additional rules and requirements. According to VA Pamphlet 26-7, Chapter Nine "The veteran must execute a general or specific power of attorney (POA) which is valid and legally adequate. The veteran's attorney-in-fact may use this power of attorney to apply for a Certificate of Eligibility and initiate processing of a loan on behalf of the veteran. The power of attorney may be used under different legal constraints depending on what state it's used.

For the purposes of a VA home loan or refinance loan:

• The power of attorney must comply with state law,

• The power of attorney must be legally enforceable in that state; and

• Clear title must be conveyable in case of VA loan default and foreclosure.

Furthermore, "to complete the loan transaction using an attorney-in-fact, VA also requires the veteran's written consent to the specifics of the transaction. This requirement can be satisfied by either the veteran's signature on both the sales contract and the Uniform Residential Loan Application, as long as the veteran's intention to obtain a VA loan on the particular property is expressed somewhere in those documents or a specific power of attorney or other document(s) signed by the veteran, which encompasses the following elements:

• Entitlement. A clear intention to use all or a specified amount of entitlement.

• Purpose. A clear intention to obtain a loan for purchase, construction, repair, alteration, improvement, or refinancing.

• Property Identification. Identification of the specific property.

• Price and Terms. The sales price, if applicable, and other relevant terms of the transaction.

• Occupancy. The veteran's intention to use the property as a home to be occupied by the

• veteran (or other applicable VA occupancy requirement)."

There are specific uses for general and specific powers of attorney. The general power of attorney is a very powerful legal document and should be used sparingly, if at all in many cases. A specific power of attorney is more protective of the military member when used on his or her behalf, but some may choose the general power of attorney instead. Make sure you fully understand the implications of using a general or specific power of attorney when considering your options in this area.

As always please see your local County Veterans Service Officer if you have any questions. You can contact your local VSO at (218) 631-7617 or by email at david.anderson@co.wadena.mn.us and as always have a great week.

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