With over a decade of experience, Army Veteran and West Point graduate Patton Gade is a top expert in military lending. As the National Director of Military Lending at UMortgage and the #1 Scotsman Guide Ranked VA Loan Originator, he’s dedicated to educating veterans and industry professionals on the benefits of VA loans. Patton leads a team of VA experts, working to expand homeownership opportunities for military members while breaking down common misconceptions. Passionate about service, leadership, and education, he’s a trusted advocate for veterans navigating the mortgage process.
In this episode:
- Understanding VA Loans and Their Key Benefits
- Financial Qualifications and Credit Score Requirements
- How Many VA Loans Can You Have?
- Types of VA Loans Explained
- VA Renovation Loans and the Role of Co-Signers
- LLCs, Trusts, and VA Loans—What’s Allowed?
- Debunking Common VA Loan Misconceptions:Â Addressing misunderstandings about eligibility, usage, and benefits of VA loans.
- The Flexibility of VA Loans: Insights from Patton Gade on how VA loans can adapt to different financial situations.
- The importance of awareness and understanding of VA loans in the real estate market.
Episode:
Narrator  Welcome to The Norris Group real estate podcast, a show committed to bringing you insights from thought leaders shaping the real estate industry. In each episode, we’ll dive into conversations with industry experts and local insiders, all aimed at helping you thrive in an ever-changing real estate market. continuing the legacy that Bruce Norris created, sharing valuable knowledge, and empowering you on your real estate journey. Whether you’re a seasoned pro or a newcomer, this is your go-to source for insider tips, market trends and success strategies. Here’s your host, Craig Evans.
Joey Romero  Thank you for joining us again for part two of our interview with Patton Gade, the National Director of Military Lending for UMortgage. Hope you enjoy. Now, so, one of the biggest benefits is the zero down. Does the VA offer more, advantageous rates?
Patton Gade  For sure. Yeah, that’s so. So, at its core, what a VA loan is, is the VA is guaranteeing to the bank 25% of the loan amount. So, if you do a $400,000 loan, the VA is actually on the hook for 100,000 of it. And so if you foreclose for some reason down the road, and the bank has to repossess your property, they don’t have to sell it for 400,000 to break even. They have to sell it for 300,000 at least. And then if they only sell it for 300,000 the VA is literally going to stroke them a check and say, ‘here’s a check for that $100,000’ so what that does for the lending institution is it removes a significant amount of risk from that loan, okay, and so interest rate is all about risk. And so a lower risk loan is going to be a better interest rate. So, VA loans are inherently lower risk, number one, they default way less than, than any other type of loan. So, veterans like to pay their bills. And so that’s, you know, that’s, we’re generally honorable people, right? And so they pay their bills, and so they default less and so, and then it’s got that guarantee from the VA which makes it less risky as well. Another thing that that lower risk allows the VA loan to do is it expands a little bit the credit availability. So, if you’ve got lower credit, or you got some missteps in the past where you you missed some payments, or you had something happen. And, you know, we’ve all had stuff happen in our life. If one of those things happened to you, it doesn’t necessarily disqualify you from a VA loan. And you should talk to somebody that can look at your situation and give it a good you know, understand what’s going on.
Joey Romero  Well, that’s…
Patton Gade  …some good advice.
Joey Romero  That’s interesting. Let’s say some of your San Diego people live in San Diego, they’re looking to buy a home down there, and it’s a million dollars. So, there are you’re saying is, essentially, they’re almost getting a credit rating for a $750,000 home because they know that…
Patton Gade  Well, I wouldn’t say they get a credit so much that, but it’s kind of, no, it’s better than, like they’re getting a rate, you know, a conventional loan at 750 is probably still going to be worse than a VA loan at a million, from an interest rate standpoint. I mean, you’re just going to get anywhere between half, three quarters of a percent lower on a VA loan than you will on any sort of conventional.
Joey Romero  Wow. So, what are the financial qualifications that they need to have?
Patton Gade  Well, it’s going to depend a little bit on the on the lender. There are a lot of lenders that will go down to, you know, as low as, like, a 500 credit score. And once you get below 620, or 600 somewhere in that range, the reason for your credit score being low is potentially going to have an impact on whether you qualify or not, okay? So, if you have, you know, if you have lates, with a whole bunch of lates in the last you know, say, 12 months, that could disqualify you from a VA loan. But you know, sometimes, you’ve had some lates in the past, you’ve gotten your stuff squared away, and now you’re, you know, you’re crazy along, but it’s going to take maybe a year or two for your credit to catch up and start to get better. And so, as long as you haven’t had a bunch of credit missteps, you know, super recently, then you may have a shot at a VA. But again, it goes back to what your specific circumstances and what you might be able to accomplish.
Joey Romero  Often, do you submit applications that don’t get approved?
Patton Gade  Hardly ever.
Joey Romero  Because you’re going to do all that work ahead of time, and you’re going to have a good idea before you even send it in, right?
Patton Gade  If ever, yeah, I can’t think off the top of my head, with the exception of, you know, I’ve had one where somebody quit their job, like, three days before closing, and then that, the underwriter, obviously a couple days before closing, we do a verification of employment. They’re like, ‘Yeah, this guy doesn’t work here anymore.; We’re like, ‘Dude, like, what are you thinking? We’re supposed to close alone on Friday, and you quit your job on Monday? Like, you couldn’t have waited a week?’ It’s a lot.
Joey Romero  Hey, I just bought a new Porche, is that gonna affect?
Patton Gade  Yeah, I’ve had, I’ve had people do that, ‘Oh, my husband just bought a new truck.’ and I’m like, ‘You just killed your whole refinance. Like you’re killing me.’
Joey Romero  So, let’s say there’s, you have a, you know, an enlisted member buys a mortgage, and then he gets shipped across the country.
Patton Gade  Yup.
Joey Romero  And so how many of these VA loans can you have at a time?
Patton Gade  So, I’ve the most I’ve ever seen somebody have at the same time is four. So, once the rules are a little bit different. So, once you have your first VA loan, now there is a limit to how much more house you can buy, and it depends on where you’re buying, and it depends on what the county loan limit is that’s set by Fed, Fannie and Freddie, what the county loan limits are, and in each county where you’re buying but I’ve seen people have up to four VA loans at one time. So, it’s pretty cool when you see somebody. I’ll tell you a quick story. I think I told this on Saturday. You know, I had a young couple that I connected with like, six, eight years ago, and they were told by like, three different lenders, like, ‘Hey, you can’t, no, you can’t buy a second house of the VA loan. It’s already used.’ I like, ‘Wait a minute, that’s wrong.’ And they bought their second house. So, I got them approved and got them their second house. They had a fort house at Fort Bragg, and they bought a house at Eglin Air Force Base. And then couple years later, he got out of the Army, and they bought a house in Alabama. It’s now they have a third house, and those other two houses are rentals. And then they lived in that house for about a year and a half. And then they’re like, ‘Hey, my sister wants to move into this house, and my neighbor has a house for sale down the road, you know, mile and a half, we’re going to go buy that house.’ And so now they’re in that fourth house, and they’re basically renting out the other three houses. And it’s literally giving them enough residual income that they don’t have to, you know, he’s got VA, retirement and disability, and, you know, they don’t really have to have a another job because, and they’re young, you know, they got young kids and everything that are running around, living their best life. With those little miniature cows that are, like, this big, you know, like… it’s pretty awesome.
Joey Romero  My favorite are the goats, though, especially how they faint. Those are hilarious. So, in lending overall, there’s a myriad of programs. It’s, you know, non QM, you know, ARMS, things like that. How many different types of loans is there in the VA program?
Patton Gade  Yeah… Well, there’s really only three. There’s a Purchase Loan, there’s the Cash Out Refinance, and then there’s the Interest Rate Reduction Loan. Okay, so the interest rate reduction loan is probably the best, best out of all of them. Number one, you know, you go, especially right now, where interest rates are a little bit elevated, and they have been for a while, but everybody’s projecting that rates are going to come down pretty significantly. And when that happens, what’s going to happen is the market. A lot of people been sitting on the sideline. A lot of people are going to flood into the market. And so that house that might be $600,000 today, when you have 10 people putting an offer on it, that’s going to push that price point, right. So, even though rates went down…
Joey Romero  Yeah.
Patton Gade  You know, you’re going to pay more for that house, and your payment might be the same or worse than what it would have been if you just bought today at a higher interest rate, and then the VA interest rate reduction loan when rates drop in the future, it’s super fast, cheap and easy to refinance that loan into a lower interest rate. And now, you know, your loan balance doesn’t really go up, but, you know, but it drops your payment significantly. Plus, as everybody else is scrambling for houses, your house is appreciating in value, and that now you got the best of both worlds.
Joey Romero  And that’s part of the problem, why there’s such so low inventory, right? Is people took that ride, even not in the VA, you know, refi at four, refi at three and a half, refi at 2.. yeah, and, so now they’re locked into those and they don’t want to get out of that, you know. So, look, hold on, let me, I lost my train of thought on myself there. Okay, so, you’re talking about what I read as I was doing a little bit of research, is that, can you actually put repairs into the price of the mortgage and roll that in?
Patton Gade  Yeah, so it’s something that not very many people do. There’s something called a VA Renovation Loan. And what it is is, let’s say you find, you find a great house, it’s in a great neighborhood, but it’s, you know, beat the crap, right? It needs renovations, or it’s got that shag right from the 70s is, yeah, with a bunch of, you know…
Joey Romero  Maybe they still like that?
Patton Gade  Everybody’s got that image in their mind, right? They probably smells like smoke a little bit.
Joey Romero  The beads in between the…
Patton Gade  Yeah.
Joey Romero  …the hallway.
Patton Gade  It’s got that orange and brown couch…
Joey Romero  Yes. the Bundy couch.
Patton Gade  Yeah. So, anyway, so you find that house, and you’re like, this is my dream house, if it was only updated, right? So, so what you do is you get it under contract. And let’s say you get it under contract for $400,000 then what you do is you get a contractor to come in and you, before you close, and they get a bid, and let’s say it’s going to be $100,000 to do a new kitchen, new bathrooms, new flooring, paint the walls, you know, do all this stuff. It $100,000 we take the purchase contract and we take the quote from the contractor, we give them to the appraiser, and we tell the appraiser, appraise this as if all this work has already been done. The appraiser comes back and says, ‘Hey, this house is going to be worth $550,000 when it’s rehabbed.’ And we go, ‘Cool’ we give the seller their 400,000 and we hold on to the other 100,000 we start paying the contractor after closing to get off…
Joey Romero  To boost the funds control.
Patton Gade  And, boom, you’ve got everything, you know, whole house rehabbed, and you’re good to go.
Joey Romero  Now, does it matter what they can they put in a pool? Can they put in another room?
Patton Gade  So, there’s some limits to it. You put in a pool and they’re not gonna, they don’t like to see structural like, if it’s minor stuff, like, okay, there’s…
Joey Romero  Stuff that’s gonna require a permit?
Patton Gade  Yeah, you’re not gonna do a whole lot. Well, it may require a permit, but it’s, they don’t like structural repairs. So, there are some limits to what you can do. And there’s some dollar limits too. It can’t be a $700,000 rehab of a, you know, of a house, because, sure, it has to be done within 60 to 90 days of closing. And you’re not going to do a $700,000 rehab in 90 days, right? That’s a, that’s a project.
Joey Romero  Can you have co signers?
Patton Gade  You can, you can. It does change the rules a little bit. And again, that’s one of those things where, you know, you can have a veteran and a non veteran who are not married, and they can use a VA loan together, but it’s going to require a down payment from the non veteran. So, those, those…
Joey Romero  So, say, like, a parent wants to help. Like, how does that?
Patton Gade  A parent can help. The parent can help, sure, oftentimes it’s, it’s maybe easier and more effective to just maybe get some gift funds from a parent, instead of them coming in and potentially to have a down payment whatnot.
Joey Romero  Okay, so what about LLCs and trusts? Can they participate in these?
Patton Gade  So, we can’t do it. You can’t do a purchase of a VA loan with an LLC, you know, but we can do it in the trust. You close in the trust, and you can refinance the trust. LLCs are typically more for investment properties or whatnot, and so you’re not going to be able, it has to be closing in a personal name, essentially.
Joey Romero  So, you know couple things that you said throughout the conversation. What if you know we talked about when they move, but let’s say somebody’s enlisted, they get their house, they’ve been living in it, and then they get dishonorably discharged. Do they lose the VA loan? Or what happens there?
Patton Gade  No, once you’re in a VA loan, you’re good. It would be interesting to see, I think I’ve never run across that, that specific scenario, Joey, like, I’m sure maybe it exists. But yeah, it would be interesting to see if you’ve lost your, if you’re, if you’ve lost your, you got a dishonorable discharge. Maybe you’re not eligible for a VA loan anymore. And I don’t know that that would necessarily come up if you try to do a refinance. I think once you’re in the system, you’re in the system. But I could be wrong about that. Good question.
Joey Romero  So, one of the other things that you said is that a lot of people thought that, oh, well, I use my, you know, I came out, I use my VA loan, and that was sold. The house is done. I can’t do it anymore. Is that still the case? Or can…
Patton Gade  That’s not the case. So, once, you know you can, you could use a VA loan 30 times.
Joey Romero  Really? For the lifetime, for your life…
Patton Gade  Sell it, buy it, sell it. It never expires. You’re, you’re good to go like…
Joey Romero  So what are the rules? Like, you have to sell that house. And then, because it’s not like a first time but home buyers, right?
Patton Gade  No, there’s not really any first time homebuyer benefit for VA. Now, essentially, you don’t, that’s depending on how expensive the first house is and what the county loan limit is where you’re buying. Like, let me give you an example. The county loan limit in most counties today in the United States, is 806 500. Okay, so let’s say you bought a house that was 400,000 the county loan limits 806 you still got $400,000 of eligibility in there. So, let’s say you you keep this house and you’re moving from, you know, Dallas to Tulsa, and you want to buy another house in Tulsa, you have 400,000 of your VA eligibility used, you still have that 406 on top of it. So, you could do another house for essentially 406 without any down payment. You could actually buy a house more expensive than that, still…
Joey Romero  I was going to ask.
Patton Gade  …still do it on a VA loan, but you have to put down a 25% down payment on everything higher than that 406.
Joey Romero  Okay, so, alright. So, in that example, I want to buy a house. That’s now I’m doing well in my life. And, you know, I we have two incomes. I want to buy, I got 400 left in my limit. And I want to buy a house is 1.4 million. So, essentially, I gotta put down 250k?
Patton Gade  That’s right, 25% of that million dollars, that’s over the limit.
Joey Romero  Okay, so not the 1.4 That’s awesome.
Patton Gade  Yeah. So, so, and, you know, as we were talking at the very beginning, you know, you were talking about, you know, the all the different speakers and everything on Saturday, I think, you know, a lot of people go, ‘Well, the VA loan is only for your primary residence and all this stuff.’ But really, what happens is, you’ve got, you’ve got all these veterans out there, you know, tons of people that are interested in becoming, you know, involved in real estate in some way, shape, matter or form. And what I always say to people is like, ‘You know what, the very first building block of this tower that you want to build, you know, this, this whole life that you want to build. The first building block of it is the VA level. Like it’s, that’s what gets you started in real estate.’
Joey Romero  What a head start you get too.
Patton Gade  Yeah.
Joey Romero  Because the barrier to entry a lot of the times, is that down payment.
Patton Gade  That’s right.
Joey Romero  And so if you eliminate that, now you’re in the game, right? And that’s truly like my kids, you know, I tell them, you know, you’re going to buy a house as soon as you can. That’s the first thing you’re going to do, when you get your job at a college or whatever, you’re going to buy houses. So, I’m sure over the years, you’ve come across a ton of people that you’ve helped. There’s been, you know, sad stories, there’s been inspiring stories. What has been the loan that has impacted you the most from the story of the people that you helped?
Patton Gade  You know, I think, I really think it’s that young family that I was telling, you know, where they were denied a couple times, and then now I look back and they’ve got four houses. They’ve got the residual income coming in, like they both messaged me, I mean pretty regularly. I mean, every couple weeks or month or something. You know, they’re on my Facebook page. They’re part of my life. Never met them in person, but you know they’ll, I’ll get a Christmas card or whatever going, ‘You know what? Patton, thank you so much for you know, change. You’ve changed our lives like I know I can always come to you and get great advice.’ And you know, those are the things you remember, right? Is the ones that where people are genuinely thankful for, you know, the impact you’ve made on them, and then, you know, you’ve built this relationship that lasts for potentially years, all over. Like, hey, you bought a house, right? How many people get to stay in touch, care about staying in touch with their loan offs that did their house? I mean, not very many. But yeah, in this, in this veteran world, it’s pretty common where, you know, I’m, I’m texting with people, ‘Hey, happy birthday. Hey’, you know, ‘Hey, saw you had another kid. Like, congratulations.’ Like, ‘I saw you named a Patton. Like, that’s awesome.’
Joey Romero  So now, being the community that you’re a part of, they’re going to be all over the country. You’re able to write VA loans. Doesn’t matter if they’re in New York, Florida, California?
Patton Gade  Pretty much anywhere. My company is not licensed in New York or Massachusetts right now, but that should hopefully change here pretty soon. So, pretty much, pretty much everywhere else, all other place, we can help you.
Joey Romero  So, what is the one thing that. So, alright, so our audience is real estate investors, realtors, other mortgage professionals. What would you want them to take away from our conversation today? What’s the most important thing that you want them to take away?
Patton Gade  You know what I I’d say that the number one thing is they’re just, there a lot of myths that exist out there, in the real estate world, and I will tell you that the VA loan itself is the most flexible loan on the planet. And as a loan officer, it gives me a lot of, a lot of ways that I can adjust things midway. You know, if something comes up and it’s not necessarily good, you know, it gives me the opportunity to adjust things. There are people that think that VA loans take forever. They don’t. They don’t take forever. Like, if I get a contract and it’s 21 days from now, I don’t even blank 21 days is easy on a VA loan. So, a lot of those myths in the past. You know, people say, ‘Oh, the VA appraisal is so hard.’ Well, guess what? The VA appraisal comes in low, a lower percentage of the time than any other type of loan. Plus the VA gives you two opportunities to affect the value as a realtor, you can affect the value before the appraisal comes out, and then after the appraisal, sometimes you can go to the VA. So, there are a lot of, lot of these things where people go, ‘Oh, these VA buyers don’t have skin in the game.’ Like, what? Like…They left their right leg, you know, on the…
Joey Romero  Yeah.
Patton Gade  On the sands in Iraq. Like, they left the whole, they got a whole leg in the game.
Joey Romero  There’s a reason it’s zero down, you know, there was other things that…
Patton Gade  And so zero down isn’t necessarily that the borrower doesn’t have money. I’ve done some loans for some extraordinarily wealthy people that are doing zero down because, they can. And like, who cares if the seller is spending the bank’s money or the borrower’s money, or some combination of the two you’re getting the same number. Like, who cares? Let’s you know. So, that’s the thing, is that the VA loan is not harder. It’s not something to be scared of, especially when it’s in the hands of a practitioner, like, Okay, is it is a tank a scary weapon, yeah, but not in the hands of somebody that’s trained to use it, right? And a VA loan is not scary, and it shouldn’t be scary to anybody involved in it, as long as you’re working with somebody who’s trained in, you know, who knows what the heck they’re doing. And that’s where I think a lot of the problems of VA loans in the past, and some of the old myths and old wives tales, or whatever you want to call them. That’s where this came from. Is like loan officers just didn’t know what they were doing, and it was their, it was their one VA loan that they’re going to see all year long, and they screwed it up. And all the realtors are now like, oh, it was the VA loans fault. No, it wasn’t. It was that idiot, loan officer that screwed it up, you know.
Joey Romero  It’s almost like, if I’m a realtor, like, I’d be on the lookout. ‘Oh, you’re a veteran. All right, let’s get you, let’s get you into a VA loan and incorporate that into the process.’
Patton Gade  Yeah. I mean, I’ve talked to realtors before. I mean, just recently, I was talking to one a friend of mine, and she goes, ‘Yeah, I’ve got this guy. He’s a retired two star general, and he’s got another job after the military, and he’s making a ton of money. He’s got a ton of money that, you know, in the bank and all this stuff.’ And she’s like, ‘I recommended to him that he put in an offer as a conventional loan, not as a VA loan, because it would be more likely to be accepted as a conventional loan.’ And he was like, ‘No, on principle, I’m not going to do it. I’m going to, I’m buying with a VA loan, and that’s what, because I’m authorized to do it, I’m using it because it’s the best loan ever,’ and he actually had a hard time getting an offer accepted, because it was a VA loan instead of conventional. And I think that’s a travesty. It’s a travesty in our industry, and we need to do better as industry professionals, whether it’s realtors, whether it’s loan officers, just really educating each other and educating, you know, sellers like, yeah, it’s not a bad deal. It’s a VA Loan. It’s not a bad thing. It can be a really good thing.
Joey Romero  Well, you know, for all the veterans out there, you know, listening, and especially you, you know, putting your time with us and to educate them, you know, I want to thank you, you know, for your service and for not only just for your service for your country, but also for the service for our industry, because I truly do think you’re providing a tremendous service to the folks that are, that are involved in VAs. So, how can people reach you?
Patton Gade  You want? The easiest way to reach me is my cell phone. I mean, if you Google my name, you’re going to find me.
Joey Romero  All right. Just, all right. Just be careful here, if you’re really going to do this, you know.
Patton Gade  You know what I you know my passion is, is serving my fellow veteran. And if somebody wants to talk to me about a VA loan, I mean, I tell people all the time. You know, when I talk to a realtor and I tell them, and I’m honest about this, if you’re having a problem, and you’re a seller agent, and you’ve accepted a VA offer, and I’m not even the loan officer, and you’re like, wait a minute, this isn’t adding up. This doesn’t make sense to me. I’ve got questions. You know, what can we do here? You know, what’s going on? And, you know, pick up the phone and call me and I’ll tell you what I think is going on based on, you know, the information that you can give me. I’m here in service of the veterans. And so if I can help that veteran buy the house that you’re selling and you have questions about it, call me. I don’t care if I’m the loan officer or not, I’m gonna, I’ll shoot you straight. I’ll give you the, you know, the right answer. And you know, same thing for veterans, like maybe you can’t qualify right now, but it doesn’t hurt to ask somebody, and it doesn’t hurt to talk about it.
Joey Romero  All right, so, so what is that contact info?
Patton Gade  So, my cell phone number is 623-866-3974. Yeah, my email is pgade@umortge.com
Joey Romero  Do you have an email? Well, like I said, thank you so much. I really, truly appreciate you jumping on, especially some short notice. I wanted this to get out right away. You know, it was really impactful to hear everybody involved that day. I was telling you yesterday, one of the really cool things that you know, between the speakers and between everybody who knew up there, each other on stage is, is kind of the ribbing that you guys gave each other…
Patton Gade Â
That’s the most fun about all of it. That’s and that, you know, I’ve got a team of like 15 guys that are, we’re all veterans, across all the services. I mean, I’ve got pilots, I’ve got Navy divers, I’ve got Surface Warfare officers, I’ve got military policemen, I’ve got signal officers, you know, I got engineers, you know, you name it. I’ve got somebody across the spectrum. And when we get on a call together, you know, it’s always that, you know, it’s always giving people a bad time and…
Joey Romero  I can imagine what the Army, Navy game looks like in your office.
Patton Gade  Yeah, it’s good stuff.
Joey Romero  So, who’s, who’s the drummer? You know, in rock bands are always all, he’s just the drummer.
Patton Gade  …the drummer is in the office. We got a bunch of people beating drums all the time.
Joey Romero  No, what I meant was like, you know, Navy, Army, Air Force, Marines, which, who’s the drummer, who’s the one that gets razzed on the most?
Patton Gade  I don’t know, maybe the Coast Guard or the or the Space Force, like nobody really knows very many of them, I have a Coast Guard guy on my team, and then I always joke with The Air Force guys, I say, well, that that was a good alternative to military service.
Joey Romero  Thank you so much.
Patton Gade  I’m totally kidding about that. I respect,
Joey Romero  Yes, we respect all of them. They’re all necessary and they’re all great. Thank you so much. I truly appreciate it.
Patton Gade  It’s been a pleasure. Joey, I appreciate you.
Narrator  For more information on hard money loans, trust deed investing, and upcoming events with The Norris group. Check out thenorrisgroup.com. For more information on passive investing through the DBL Capital Real Estate Investment Fund, please visit dblapital.com.
Joey Romero  The Norris Group originates and services loans in California and Florida under California DRE license 01219911. Florida mortgage lender license 1577 and NMLS license 1623669. For more information on hard money lending go to thenorrisgroup.com and click the hard money tab.