Power of Attorney helps ensure that deployed service members and other Veterans who can’t be present to sign documents can still use their VA home loan benefit.
Power of Attorney (POA) is a familiar concept for many VA buyers.
POA is a legal instrument allowing service members to designate a person who can enter into contracts and execute other civil, financial and legal obligations on their behalf - often because of a deployment.
You can use power of attorney to obtain a VA loan. In other words, the Veteran or service member does not have to be present during the buying process as long as POA requirements are met.
Lenders need to verify the service member or Veteran is alive and, if on active duty, not missing in action. This is commonly known as a VA alive and well statement.
This process is necessary to obtain a VA loan through power of attorney.
The VA alive and well statement is typically a verbal communication with the borrower on the day of closing, but some lenders may also require a formal letter from a supervisor.
Beyond the alive and well statement, there are two types of power of attorney commonly used by the VA and approved lenders when Veterans want to use VA benefits without being physically present.
Your unique circumstances will likely dictate whether you need a General POA or a Specific POA.
General Power of Attorney is, well, general in nature. It gives your assigned agent the power to handle many broad needs on your behalf, from filing taxes and making banking transactions to signing contracts.
There are two scenarios that allow VA buyers to use a General POA:
It doesn’t matter if they can’t sign other documents as the loan process moves forward. If they can sign these two early documents, you can use General POA.
In either case, some lenders may accept electronic signatures.
You’ll need to use a Specific POA if the buyer is unable to meet the requirements for a General POA.
Specific POA is also known as limited Power of Attorney. It’s limited because the agent is only allowed to execute on a very specific issue, such as a VA home loan for one particular property address.
At Veterans United, to move forward with a VA purchase, your Specific POA must contain the following information:
Other lenders may have their own guidelines regarding VA loans and Specific POA.
Military members purchasing while overseas or otherwise relying on Power of Attorney is more common than many people realize. The VA ensures that deployed service members and other Veterans who can't be present to sign documents still have access to this cherished and increasingly valuable benefit.
You can discuss your unique situation with a VA home loan expert at 855-870-8845.