The VA loan program is being heavily utilized by Orange County residents for the first time in several years. There are several reasons for this.
- The increase in the Orange County, CA VA loan limit for $0 Down financing to $593,750 in 2010.
- The drop in property values in Orange County, CA. (And the rest of the US)
- The lack of other high loan to value programs.
VA 100% Financing for Orange County, CA Homes to $737,500 *updated for 2010 $593,750 is limit in Orange and LA counties
The VA loan program is a great program for those that are eligible. Fannie Mae/Freddie Mac require a minimum of 10% down payment for a home in Orange County. Even FHA, which is a great program, requires a 3.5% down payment. To make the comparison even better, while FHA has Monthly Mortgage Insurance equal to .55% (essentially adding .55% to the interest rate) VA has no monthly mortgage insurance. This can save thousands of dollars a year for VA eligible home buyers.
How Do I Find Out if I am Eligible for a VA Loan in Orange County?
To obtain VA home loan veteran benefits you must have served on active duty in the Air Force, Army, Coast Guard Navy or Marine Corps and have been honorably discharged. You may still be entitled to benefits if you were discharged under other than honorable circumstances. This requires further research by the VA. In the end the VA makes the final determination.
The first thing you need to obtain in order to use your VA Entitlement is a VA Certificate of Eligibility. If you do not have one already we would be happy to assist you in getting one. The process is quick and easy. Just call our office and we will be glad to send out to you a VA Form 26-1880 or request for COE. Simply fill it out and return it to the VA and you should have your COE within a couple of weeks. If you are in a hurry, you may visit your local VA Office and have your COE in as little as one day.
If you are looking to purchase a condo, you must first check to make sure the condo project is on the VA Approved Condo List.
What is the First Step in Getting PreApproved for a VA Loan in Orange County?
VA loans, like FHA and Conventional Fannie Mae and Freddie Mac loans, require full income documentation to qualify. Really, all mortgage loans are full doc these days. This means that to qualify for a VA loan, besides having the property, VA Entitlements, and supplying a DD214 and then Certificate of Eligibility, the Veteran will need to provide the following items:
- Paystubs for the most recent 30 days. These need to show a consistent income, whether it be an hourly wage or salary. Overtime will be averaged out over the past 2 years, as long as it is continuing at present. The lender will be looking at the Gross income, before taxes and other deductions.
- Tax Returns and W2's for 2007 and 2008, or the most recent 2 years. Again, the lender is looking for some consistency. There are situations where the lender can look at other factors if consistency is not apparent. Compensating factors are important in any loan file. A compensating factor can be any of the following: time on the job, good cash reserves, high FICO scores (over 740), low debt to income ratio's.
- 2 months most recent bank statements. Although VA does not require cash reserves, it can help the loan file if other areas are weak. Also, a VA underwriter will look for NSF's on the bank statements, which would require a letter of explanation.
One of the best things about a VA loan for Orange County home buyers is the VA Streamline Refinance program, or IRRRL, which allows VA borrowers to quickly and easily take advantage of low rates with having to appraise the property or even provide all the income documentation that is needed during the initial purchase.
It is important to know that there is a difference between the VA loan program and the CalVet loan program. Learn as much as possible about these two programs before choosing one or the other.
Who Actually Funds Orange County VA Loans?
You just need to find an Orange County VA Lender. A Direct VA Lender will process, underwrite, and fund your VA loan, rather than just originate and then "broker" to another lender. You will also want to find a loan officer who has experience with VA loans and can provide you with a loan scenario showing a complete break down of the purchase price, loan amount, payment, and closing costs involved with a VA loan. It is important to get as educated as you can on all that goes into getting a VA loan before you actually begin making offers on homes.
Authored by Tim Storm, an Orange County, CA Loan Officer - Please contact my office at Trust One Mortgage for more information about an Orange County, CA home loan. 877-786-4243 x 7. Ask for Tim Storm.
Contact us for your Orange County VA Mortgage:
Call our office today and see how we can help you and your family. Ask for your Free First Time Home Buyer Report.
877.786.4243 x 7 | tstorm (at) ochomebuyerloans.com
*Trust One Mortgage Corporation is licensed and supervised by the California Department of Real Estate (“DRE”), License # 01087829
