Veterans, if you have used your VA entitlement to purchase a home, are you aware you can use it more than once? This benefit never expires. As long as you do not allow for the VA loan to be assumed, and you sell your existing home, you can use it again to purchase a new home. However, if you allow for somebody to assume this mortgage, then you will lose your entitlement!
Veterans, are you aware that you could actually own two homes using your VA entitlement? Depending on the purchase price of your home, if you have remaining entitlement available, it may allow you to get another home. For some veterans who purchase a home “a long time ago”, your VA entitlement may have increased.
Veterans, are you aware that there is no loan size limit on VA financing? The maximum VA loan is based on the maximum Federal Housing Finance Agency limit per the county. Any loan size above the FHFA county limit will require a contribution of 25% of the difference between your loan amount and the county limit. Exampled? Loan Limit of $453,100 per the county. Your loan size of $500,000.
Formula: $500,000-453,100 = $46,900 x 25% = $11,725 required contribution.
For some borrowers, zero down payment programs or down payment assistance programs are available. Let me explain what this means.
USDA is a program that is available for areas of the USA that are deemed rural areas. This means for a population of 15,000 or less. The program does not require a down payment but does have income limitations that you must meet. It also has tougher debt to income qualification then other loan programs.
Then there is VA loans which if your a veteran, means they will guaranty a loan for you up to $453,100 with zero down payment. VA does not have a maximum loan limit but anything above the loan limit will require a down payment of 25% of the difference between the $453,100 and the actual loan amount.
Down payment assistance programs are not 100% financing programs, but they will lend or give you the down payment. The Golden State Finance Agency program can offer a grant (doesn’t have to be paid back) which will cover the down payment for FHA or Conventional financing. There are income limitations you must meet and the underwriting guides are a bit tougher than the normal FHA or conventional loan, but if you fit, you dont have to pay back this money. Since you are getting free money, expect to pay a higher rate of interest for this program. But, if this will get you into a home today, then its well worth making a bit higher monthly payment to do so!
For any questions regarding any of these programs, please give me a call or email us. We are happy to see if we can qualify you for these programs.