Tim Storm | Orange County, California VA Loans - Tim Storm

VA to Increase Loan Limits in 2011 | Orange County, CA

December 12, 2010 by Tim Storm

The loan limits for 100% VA loan financing in Orange County, CA have been increased for 2011 to $700,000. This is great news and means VA eligible home buyers will be able to purchase homes up to $700,000 with no down payment. There is no other loan programs allowing $0 down anywhere near this loan amount.

This is a bit of a reprieve from what VA did in 2010. Back in 2009 the 100% financing limit was $737,000, but in 2010 the limit was dropped to $593,750. While still a very aggressive loan amount, $700,000 is even better. On top of that, if a qualified Veteran (or Active Duty) wants to purchase a property for more than $700,000, they can. They will just need a small down payment. The down payment is equal to 25% of the difference between the 100% financing limit and the purchase price/appraised value. For example, a Veteran purchasing a home in Irvine for $800,000 would only need a $25,000 down payment. ($800,000 – $700,000 = $100,000. 25% x $100,000 = $25,000). The Veterans income would need to be sufficient to qualify, but still, this is a very aggressive program.

Orange County Experiencing Many High Balance VA Loan Closings in 2010

As Veterans have begun to realize the potential available to them because of their access to the VA loan program, Orange County has seen more and more high loan balance VA purchase transactions. For example, there was a recent closing in Lake Forest, CA on a $640,000 property. Based on the 2010 loan limit of $593,750, the buyer needed only $11,562 for the down payment. (In 2011 he would not have needed any down payment.) The buyer was self employed, but that did not stop him from easily qualifying for the purchase. Also, VA does not have Mortgage Insurance, which nearly all loan programs have when less than 20% down payment is used. The monthly Mortgage Insurance on an FHA loan on a $640,000 purchase price would be approximately $463 per month. Plus, FHA requires 3.5% down payment, which would have been $22,400. So this buyer not only was able to keep an extra $11,000 in the bank, but also now has a payment with no Mortgage Insurance.

Talk To Orange County VA Lender Before Shopping for a Home

The first step in purchasing a home is to get the financing figured out. The last thing you want to do is find a great home, make an offer, and then, three weeks into the transaction have the lender tell you that you don’t qualify. These days, sellers will typically not accept an offer unless the buyer has already be PreApproved by a direct lender. Your lender should be able to put together several personalized loan scenarios which will give you a complete breakdown of either what you will qualify for or what you are comfortable with, whichever is lower. The scenarios should give you a breakdown of the purchase price, loan amount, closing costs, and amount needed to close. It is possible to request that the seller pay for all closing costs, but this is something that should be figured out before an offer is made.

There has not been a better time to buy a home in years. The “affordability index” is better than ever, with a mortgage payment comparing favorably to rent for the first time in years. The first step is to contact a VA Loan Expert.

Authored by Tim Storm, an Orange County, CA VA Loan Officer – Please contact my office at Home Point Financial for more information about an Orange County, CA home loan. 949-640-3102. MLO 223456

Call our office today and see how we can help you and your family. Ask for your Free First Time Home Buyer Report.

tstorm (at) ochomebuyerloans.com

Closing a VA Loan in Orange County in 30 Days or Less is Easy

October 30, 2010 by Tim Storm

Closing a VA loan in Orange County in 30 days or less is not only possible, but is easy. But for the loan to close this quickly, all parties involved must be ready to react quickly to requests from the lender.

What Needs to Happen For a 30 Day VA Loan?

Borrower – it helps tremendously if the borrower has already met with an Orange County Direct VA Lender and has a PreApproval in hand. If the borrower is already PreApproved for a VA loan, then the lender should have tax returns, paystubs, bank statements, loan application, and credit. The lender may need to update the file with new paystubs or bank statements, but PreApproval will give the lender a good head start in closing the deal quickly.
Real Estate Agents – The lender will need the complete purchase contract and any counter offers, as well as escrow company contact information. The Orange County VA lender needs this information so they can contact escrow immediately.
Escrow Company – The lender will send the “Initial Fees Worksheet” to the escrow company, along with the lenders contact information. The lender needs to receive the Estimated HUD-1, also known as the Estimated Closing Statement, from the escrow company prior to completing the Good Faith Estimate and loan disclosures for the borrower. The appraisal can’t be ordered until the lender has sent loan disclosures out, so receiving the Estimated Closing Statement from escrow is an important step in closing escrow in 30 days or less.
Appraisal – The VA appraisal is ordered by the lender through the VA Portal. It can take anywhere from one to two weeks to receive the appraisal from the day it is ordered, so the lender needs to order the appraisal as soon as possible.

If there is a break in the chain, if one of the parties involved in the transaction causes a delay, 30 days can quickly turn into 35 or 40 days. For this reason, the lender should have a timeline mapped out and make it clear to all parties that items needs to be received quickly. An experienced lender can pull off 30 days VA loan closings almost every time as long as everyone works as a team.

VA Loan PreApproval is the First Step

The first step is to get PreApproved for a VA loan before making an offer on a home. Finding an experienced VA loan officer who works with a Direct VA lender in Orange County is important. While it is easy to find VA lenders on the internet, Orange County has some very experienced VA loan officers. Also, it can be helpful to meet face to face with the loan officer and get all of your questions answered.

Authored by Tim Storm, an Orange County, CA VA Loan Officer – Please contact my office at Home Point Financial for more information about an Orange County, CA home loan. 949-640-3102. MLO 223456

Call our office today and see how we can help you and your family. Ask for your Free First Time Home Buyer Report.

tstorm (at) ochomebuyerloans.com

Filed Under: VA Purchase Loans Tagged With: 30 day close, orange county va loan, va loan preapproval

VA Home Loans versus CalVet | Which is Better for California Home Buyers

July 31, 2010 by Tim Storm

There are several differences between the VA home loan program and the Calvet home loan program. California veterans should take time to learn about both programs to determine what is best for them. There are times when the Calvet program is better and other times when the VA home loan program is better. Below are some of the differences, and why at this time the VA home loan program is better for most California veterans purchasing a home.

CalVet vs VA: Who is the Lender?

VA home loans are guaranteed by the Veterans Administration, but the actual loan is made by banks and mortgage banks. The VA’s guarantee on the loan encourages lenders to offer favorable terms to veterans, resulting in low interest rates. With the CalVet program, the state of California is the lender. California uses bond funds to lend to any virtually any Veteran who wishes to purchase a home in California.

Va vs. CalVet | Down Payment Requirements

The loan limits for 100% financing on a VA loan in Californiavary by county. For example, in Orange County and Los Angeles County, the 100% financing limit is $679,650 (2018 loan limit). California VA loan limits are very high. It is possible to go above $679,650 by coming in with a small down payment. The down payment is equal to 25% of the difference between the 100% financing limit and the purchase price.

The CalVet loan limit in California is $521,250, including the the financed Funding Fee. In some California Counties that limit is higher than VA, and in some counties it is lower. CalVet offers three basic programs: a 100% financing program, a 97% program, and a 80/20 program. There are subtle differences between these programs which need to be understood. While the 100% program allows the VA Funding Fee to be financed into the loan, just like the standard VA home loan program, the 97% program requires it be paid in escrow. This adds a considerable expense, on top of the down payment requirement.

Interest Rates for VA and CalVet home loans

Interest rates will fluctuate for the VA home loan program. This is an area where the VA program can easily beat out the CalVet program, and why the VA program has been more popular over the past few years. In 2010, VA home loan interest rates and been in the 4.5% to 5.5% range. The CalVet interest rates currently range between 5.75% and 6.2% according to information posted on their website. Because CalVet interest rates are based on Bond Funding, their interest rates do not quickly fluctuate.

Restrictions on the CalVet program

The CalVet program functions differently than the VA home loan program. With most mortgage programs, including the FHA, VA, and Conventional home loan programs, the California home buyer holds title to the home. The lenders holds the lien. Calvet uses a Contract of Sale for the financing instrument. This means CalVet actually holds title. There are advantages and disadvantages to this. It makes it difficult to refinance or get a second mortgage, whether its to take advantage of low interest rates or improve the home. An advantage is that CalVet is able to get group insurance rates for home owners insurance. In some areas where home owners insurance is difficult to get this can be beneficial. VA financing on condos in California can be tricky with either program. The condo project should be on the VA approved condo list.

When beginning the process of buying a home, it is important to find a California VA loan expert who understands the VA loan program and can quickly PreQualify and PreApprove you for a home loan. Finding someone who can answer your questions and provide customized loan scenarios is important.

Authored by Tim Storm, an Orange County, CA Loan Officer specializing in VA Loans. MLO 223456. – Please contact my office at Fairway Independent Mortgage Corporation NMLS #2289. My direct line is 714-478-3049. I will prepare custom VA loan scenarios that 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.

Call our office today and see how we can help you and your family. Ask for your Free First Time Home Buyer Report.

tstorm (at) ochomebuyerloans.com

Filed Under: VA Purchase Loans Tagged With: california, calvet, first time buyer, Orange County, VA Loan

Orange County VA Home Loans After Foreclosure or Short Sale

July 8, 2010 by Tim Storm

Orange County Veterans who have had a short sale are able to purchase a home with $0 down immediately after the short sale. Veterans who have had a foreclosure need to wait two years. VA is relatively flexible in how they look at foreclosures and short sales, compared to FHA and Fannie Mae.

Short Sale versus Foreclosure

A short sale occurs when a home owner sells their home, even though they owe more than the home is worth. Their Orange County home loan lender needs to sign off on the home sale, since it is the bank who will be taking a loss on the property if it is sold. A short sale can help to preserve a home owners credit compared to going through a full fledged foreclosure. FHA typically requires 3 years after a foreclosure or short sale, unless extenuating circumstances can be proved as the reason for the short sale. Fannie Mae requires between 4 and 5 years after a foreclosure, but will lend to 80% of the properties value only two years after a short sale. But VA, at least for those that are eligible, will lend to 100% of the properties value up to the county VA loan limits. The VA Loan limits in Orange and Los Angeles counties, the $0 down loan limit is $679,650 in 2018.

Veterans Need Perfect Credit After Foreclosure or Short Sale

The only catch is that the Orange County veteran will need perfect credit since the short sale or foreclosure. Especially over the most recent 12 months. Many times, leading up to the short sale, the seller may have multiple mortgage lates, possibly 90 or 120 day lates. This can really weigh the credit report down and hurt the FICO score. This is why it is important to reestablish credit immediately after the short sale, or foreclosure, and n0t have any more lates after the sale of the home.

Quick Way to Find if you are Qualified for a VA Home Loan in Orange County, California

It is always important to get PreApproved for a VA loan prior to make an offer on a home. It is probably even more important to do after a short sale or foreclosure. Find a reputable VA loan expert in Orange County, CA, and have them prepare personalized VA loan scenarios which will give a breakdown of the purchase price, loan amount, closing costs, and amount needed to close. The VA loan officer can get the Automated Loan Approval, which is an important step in determining early on whether you can get a VA home loan to purchase a home. The key is to make sure to find someone with experience to get them job done easily and quickly,

Authored by Tim Storm, an Orange County, CA VA Loan Officer – Please contact my office at Home Point Financial for more information about an Orange County, CA home loan. 949-640-3102. MLO 223456

Call our office today and see how we can help you and your family. Ask for your Free First Time Home Buyer Report.

tstorm (at) ochomebuyerloans.com

Filed Under: VA Purchase Loans Tagged With: california, Orange County, short sale, va home loan, VA Loan

Importance of Getting Your Condo Project Approved for FHA and VA Financing

June 14, 2010 by Tim Storm

It is more important that ever for Condo projects to either keep their FHA and VA project approvals, or if not already approved, submit the paperwork to get approved. Orange County, CA, along with most of Southern California, has a high concentration of condo projects, yet a high percentage of these projects are not approved for FHA or VA financing.

Why is it important for Orange County Condo Projects to be FHA and VA Approved?

Over the past few years home financing has gone through dramatic changes. Guidelines have tightened up. Lenders are especially wary of condo projects and have begun to look very closely at the financial strength of individual associations. Most of the time nobody realizes there is an issue until a seller can’t sell their home, or has to sell at a great depreciated price since the pool of buyers is limited to those who are not using FHA or VA financing. FHA and VA financing combined for more than 35% of all loans in Southern California in 2009. Orange County First Time Buyers looking to buy a condo start with a list of FHA or VA approved projects. Projects not on the list are not even considered in the home buying process.

FHA Eliminated the Spot Approval Program

Up until late 2009, FHA allowed for “Spot Approvals“. A Spot Approval was the financing of one unit in a project that was not approved. That is no longer possible. Now, the project needs to be approved. VA allowed financing on projects that were on the FHA approved list, even if they weren’t on the VA approved condo list. Now, FHA has changed the rules for project approval. VA will still allow financing on FHA approved projects, but it depends on when the project was FHA approved, along with a few other factors.

How Do You Get a Condo Project Approved for VA or FHA Financing?

There is definitely the easy way and the hard way. The hard way to to do it yourself. You will need to put together a package that includes the budget, reserves, financials, investor concentration, etc. Here is the link to the FHA Condo Approval process. The easier way is to hire a company that specializes in getting Condo projects FHA and VA approved. Most of these companies charge a reasonable fee and will handle the process from start to finish. It’s not fun to deal with FHA or VA, so putting this in the hands of a company that does it full time is a great way to go.

With FHA loan limits in 2011 for Orange County at $729,750, and VA loan limits for 100% financing at $700,000, having your condo project approved will help to keep your property value as high as possible. *updated for 2011

Authored by Tim Storm, an Orange County, CA VA Loan Officer – Please contact my office at Emery Financial Group for more information about an Orange County, CA home loan. 877-786-4243 x 7.

www.OCFHALoans.com

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

Filed Under: VA Purchase Loans