The VA loan limits for 2015 in Orange County, CA will be $625,500, which is a little lower than last year but still a high limit considering there is no down payment required. The $0 down VA loan limit in 2014 for Orange County was $687,500, and over the last few years the limit had gotten as high as $737,000. In 2015 the Veterans Administration adjusted the limit to match the Conforming loan limits set by the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac.
VA Financing for SFR's and Condo's
$625,500 still buys a nice home in Orange County. VA financing is available for Single Family Detached homes, 2-4 unit properties, and condominiums. Similar to FHA financing. a condo project must be on the VA approved list for a VA loan to fund. However, while the FHA condo approval list is fairly limited, there are a surprising number of approved condo projects in Orange County. The VA condo approval list out numbers the FHA approved list by nearly 5 to 1. For example, in Mission Viejo there are currently only 10 FHA approved condo projects, while there are 60 VA approved projects. In Anaheim there are 23 FHA approved and 89 VA approved condo projects. And in Irvine there are 25 FHA approved condo projects versus 120 for VA. This makes VA a great program for marketing those condo's that are located in approved projects.
Jumbo VA Loans to $1,500,000
The "VA Loan Limit" is the limit for Zero Down financing. It is still possible to use VA financing for purchase prices higher than $625,500. This is known as the VA Jumbo Loan program. There is some down payment required, but not much when compared to other types of financing. The down payment is equal to 25% of the difference between the 100% financing limit and the higher purchase price. For example, if a Veteran was to purchase a home in Irvine for $725,500 (an even $100,000 over the loan limit for simplicity sake), then the down payment required from the Veteran would only be $25,000 and the base VA loan would be $700,500. ($100,000 difference x 25% = $25,000 down payment. The other 75%, or $75,000 in this case, is added to the loan limit of $625,500.) This means a Veteran could purchase a $725,500 home with less than 3.5% down payment. While some lenders will have their own "max" loan amount, many lenders will fund VA loans as high as $1,500,000.
VA Loans are Easy to Close
The fact the VA loans are easy to close probably comes as a surprise to those not familiar with the program. But the fact is the VA program is more flexible than other types of financing. When it comes to credit, FICO scoring, debt to income ratios, loan to value, the lack of reserve requirements, prior bankruptcy and foreclosures, VA is more flexible than any other type of Conventional or Government loan program. Also, VA loans have the lowest default rate of any other type of financing, which is also a surprise to many who assume that the lack of a down payment would result in more defaults.
The first step in determining whether a VA loan is the best option for a Veteran is to talk with a VA loan specialist, who will be able to provide custom VA loan scenarios. Prequalification and then PreApproval are important steps to go through prior to making an offer on a home. By working with VA lender first, you will make sure you are buying a home with a payment that fits within your budget, including your long and short term financial goals.
Authored by Tim Storm, a California Mortgage Loan Officer MLO 223456 – Please contact my office at the Home Point Financial. Direct line at 949-640-3102. www.OrangeCountyVALoans.com. I prepare custom VA loan scenarios which will be matched up to your financial goals, both long and short term. I also prepare a Video Explanation of your scenarios so that you are able to fully understand the numbers BEFORE you have started the loan process.