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

VA Loan Refinancing Picks up in Orange County, CA

November 20, 2012 by Tim Storm 1 Comment

VA loan refinancing has picked up quite a bit in Orange County in 2012. And it’s not just current VA borrowers taking advantage of the VA to VA Interest Rate Reduction Refinance Loan, also known as the IRRRL. Veterans are also refinancing out of Conventional loans and into VA loans.

Why Refinance from Conventional to VA?

VA loan guidelines offer several advantages over typical Conventional loan guidelines. Lower FICO score requirements, less equity, higher debt to income ratios, and less time needed after a foreclosure or bankruptcy are all reasons why VA refinancing has been so popular in 2012. Also interest rates on a VA loan tend to be as low or sometimes lower than other types of loans. And while VA does have a Funding Fee which is financed into the loan, there is no Monthly Mortgage Insurance which is typical for other high loan to value financing.

Orange County has high loan limits for VA Financing

Orange and Los Angeles counties have high 100% financing limits for VA loans. It is possible to buy or refinance with no down payment or equity up to a $687,500 (2014 limit) loan amount. That is higher than the high balance Conforming loan limit of $625,500. Plus, it’s possible to get financing as high as $1,500,000. There is an equity requirement when the loan is over $687,500 equal to 25% of the difference between the appraised value and the 100% limit. For example, if an Orange County Veterans home appraises for $887,500 then the max VA loan would be $837,500.

How do you know if a VA loan is for you?

A VA loan is not the best loan in every situation. It’s important to compare your options. Find a local Orange County lender who specializes in VA financing. Have the lender prepare a custom Side By Side analysis comparing your current loan to a VA loan and whatever others options that are available.

Authored by Tim Storm, a California Mortgage Loan Officer MLO 223456 – Please contact my office at the Emery Financial. Direct line at 949-640-3102. www.OrangeCountyVALoans.com

Filed Under: VA Refinance Loans

Orange County VA Loan Limits Increase through end of 2012

August 19, 2012 by Tim Storm 1 Comment

The VA loan limits in Orange County, CA were already at a high level in 2012. Effective August 6, 2012, the VA loan limits for 100% financing in Orange County has been increased from $621,000 to $675,000. The Honoring America’s Veterans and Caring for Camp Lejeune Families ACT of 2012 brought several changes to the Veterans Guaranty loan program. The biggest change is that the calculation for each counties zero down limit has been reverted back to the old version (pre-2012). The new loan limits applies to all VA loans closed from August 6, 2012 through December 31, 2012.

$675,000 with No Down Payment in Orange County, CA

$675,000 buys a nice home in Orange County. This limit also applies to Los Angeles County. The property can be a single family home or a condo. If it is a condo then the condo project needs to be on the VA Approved Condo list. It is also possible to use VA financing to purchase a 2, 3, or 4 unit property as long as at least one of the units will be occupied by the Veteran.

How about a $1,000,000 Jumbo VA loan?

Technically, VA does not have a “limit”. There is a limit for 100% financing, but it is possible to purchase a home for more than the 100% financing limit by coming in with a small down payment. A down payment equal to 25% of the difference between the 100% financing limit and the purchase price is required. For example, if Johnny Johnson wants to buy a home in Irvine with VA financing for a price of $775,000, then a down payment of $25,000 is required. The base VA loan would be $750,000. ($775,000 price less $675,000 limit = $100,000. 25% of $100,000 is $25,000, which is the down payment.) That end up being 3.23% down payment on a $775,000 purchase price. With no mortgage insurance and a low fixed rate. There is no other type of financing that can touch a VA loan.

Refinance to VA loan at $675,000 with No Equity in Orange County

This new loan limit is not just for purchasing a home. It also works for a refinance. For a Veteran who bought their home several years ago and put 20% down, but now has no equity, this can be a great solution. Especially since the Conforming loan limit in Orange County is $625,500. Not only does a Conventional loan require 20% equity for a refinance (unless you are able to get Private Mortgage Insurance which is an added expense and is expensive), but VA interest rates are most likely lower than a high balance Conforming loan. And almost certainly lower than a Jumbo 30 year fixed on a Conventional loan.

The first step in determining whether a VA loan is right for you is to contact a local Orange County VA loan specialist. Your VA loan officer should be able to prepare custom loan scenarios after a quick conversation over the phone. The loan scenarios should give you a very clear and concise break down of the numbers involved in purchase or refinance to a VA loan. Even better, your loan officer should be able to prepare a custom “screen capture” video which will walk you through loan scenarios, answering questions you may have.

Filed Under: VA Mortgage, VA Refinance Loans Tagged With: 2012, Irvine, Orange County, refinance, va loan limit

Impound/Escrow Accounts are Required on VA Loans for Orange County Veterans

June 17, 2012 by Tim Storm Leave a Comment

An impound account, also known as an escrow account, is required on VA loans for the life of the loan. The purpose of the impound account is to make sure the Veteran stays current on the property taxes and home owners insurance. The last thing anyone wants is a property tax lien, which could take precedent over a VA mortgage. Most lenders in California require an impound account on any type of loan when there is less than a 10% down payment. The FHA loan program, which is another government loan program available to anyone and only requires a 3.5% down payment also requires an impound account for the life of the loan.

Is the Impound Account Interest Bearing?

In most states the Escrow Account is not interest bearing, meaning the Veteran does not earn interest on the money being held in the account on their behalf. However, in Orange County and in California it is now law that escrow accounts earn interest which is paid out to the homeowner. However, don’t expect to make a killing. The amount of interest earned will be minimal.

The Impound Account Helps VA Homeowners Budget Their Cashflow

This “forced savings” account is meant to help the Orange County Veteran budget their finances. It is not uncommon for homeowners to not budget for the semi annual tax bills or annual homeowners insurance payments. Property taxes in Orange County, CA are due on November 1 and then again on February 1. Tax payments that are not made prior to the grace periods of December 10 and April 10 become delinquent, which carries penalty fees. Also, it could turn into a tax lien. Having an escrow account prevents all this.

For homebuyers and homeowners who are interested in learning more about VA financing and all the benefits the program offers, contacting a local Orange County VA loan officer is the first step.

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

www.OCFHALoans.com

tstorm (at) ochomebuyerloans.com

Filed Under: VA Mortgage

What Your Real Estate Agent Needs to Know about VA Financing | Orange County, CA

June 17, 2012 by Tim Storm 1 Comment

(Updated Feb 19, 2018) Although VA financing is a great way to purchase a home in Orange County, CA, it is still used rarely enough that Orange County real estate agents are unfamiliar and even uncomfortable with VA buyers. It is not uncommon for a VA buyer to feel like they are being pushed aside if there are multiple offers on a property. For this reason, it is important that the real estate agents who choose to work with a VA buyer are familiar with certain aspects of VA financing.

VA Financing in Orange County is Easy! Trust Me

VA financing is actually fairly easy compared to other types of financing.

Credit and FICO scoring – VA is very flexible, with most lenders allowing FICO scores as low as 620, and that is for 100% financing. Try getting a Conventional loan with even 5% down and a 640 FICO score. – and no reserves? Also, VA requires less time after a bankruptcy (2 yrs) or foreclosure (2 yrs) than a Conventional loan.
Debt to Income ratio – The guideline for a VA loan is 41%, meaning 41% of the Veterans income can go towards the mortgage payment, car payments, etc. But approvals are common with debt to income ratios over 50%. (even 60% in some circumstances). Conventional financing tends to cap out at 45%. FHA is fairly similar to VA when it comes to debt to income ratios.
Down payment – this is the biggy. In Orange County a Veteran can buy a home with no down payment up to a price of $679,650 (in 2018). FHA requires 3.5% down payment up to a loan of $679,650 (2018). On a Conventional loan under $453,100, 3% down is possible, but 5% down is more probable. When the loan amount is over $453,100 (the Orange County Conforming limit is $679,650) then a 5% down payment is required. And of course, with a Conventional loan with less than 20% down payment, mortgage insurance is required. FHA also has mortgage insurance, both up front and monthly. And FHA’s mortgage insurance premiums are fairly high. VA has no monthly mortgage insurance!
Jumbo Loan Amounts – While Conventional and FHA loans cap out at $667,650 in 2018, VA doesn’t really have a limit. But it is difficult to find a lender that will go higher than $1,500,000. Yes, the $0 down limit in Orange County is $679,650 in 2018, but if a Veteran purchases a home for more than that price, they can still get a “Jumbo VA Loan“. They have to come in with a down payment equal to 25% of the difference between the purchase price and their 100% limit.
Interest rates – VA interest rates (like FHA) tend to be lower than Conventional interest rates. But again, while FHA has mortgage insurance, VA does not. And considering that at the moment it is difficult to get an aggressive Jumbo 30 year fixed rate, VA can be a great option for a $1,000,000 30 year fixed rate for those that are eligible.

So all of this sounds great. What is the issue then? Why is there a misconception of VA financing in Orange County? I think it is a fear of the unknown. Most real estate agents have not been involved in a transaction with a VA buyer. If they have, it was a long time ago. What are the concerns?

Common Concern with VA Financing and the Answers

“I’ve heard is take a long time to close escrow”. Well, it doesn’t if the lender knows what they are doing. As with any type of financing these days, its important that the Veteran be PreApproved before they make an offer on a home. Get all their ducks in a row. But again, this is the case with any type of financing. Closing a VA loan in 30 days is not difficult. One of the hardest things to do in the processing of a loan is to document funds to close. At least with VA there’s not much money needed, if any.
“I’ve heard VA appraisers are very conservative”. Huh? Where does this come from? Most VA appraisers also do FHA and Conventional appraisals. The value analysis is no different than any other type of appraisal. A VA appraiser will look more closely for safety issues than on a Conventional appraisal. If there are broken windows, holes in the floor, or loose wires hanging from the walls, be ready for some repairs. But this is no different than FHA. And if the house really looks that bad, a Conventional appraiser could call out the same things.
“Doesn’t the seller have to pay the buyers costs”. The quick answer is “no”. In the old days (a few years ago), certain expenses, like lender fees, escrow fees, and a few other smaller fees could not be paid by the buyer. But a VA buyer is allowed to pay up to 1% of the loan amount in what would be called “non allowable fees” if there is no Origination Fee. Partly because Orange County tends to have larger loan amounts than other parts of the country, and because after changes a few years ago to the Good Faith Estimate, any Origination Fee is typically just the lender fee anyway. On most deals there is plenty of room to fit the other “non-allowable” fees in the the 1% threshold. Non-Allowable fees have effectively become a non-issue and the seller is not required to pay closing costs for the buyer.
“Is a termite inspection required”. Yes. And this is one big difference between all other types of financing. While other types of financing do not require a termite inspection, or clear termite report, VA does. This is a “regional requirement”. All Section 1 items are required to be cleared on the Report, but it should be noted that at the underwriters discretion, Section II items may also need to be cleared. And since Section II items tend to be relatively minor, it should just be made clear that “All Section I and Section II items need to be clear.” Also, it should be noted that while VA does not allow the Veteran to pay for the actual termite inspection, the Veteran IS allowed to pay for the repairs listed on the report.

Find a Lender AND a Real Estate Agent Knowledgeable with VA Financing in Orange County

Working with real estate professionals who are familiar with VA financing is important. The first step should be to contact a local Orange County VA lending specialist who can walk you through the loan process. Once Preapproved for a VA loan, you will be able to confidently begin the search or a home. While working with a Real Estate agent who is familiar with VA financing is important, a good VA lender can quickly advise your agent on the keys to VA financing.

*updated February 19, 2018

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

Filed Under: VA Purchase Loans

Refinance to VA Loan from Conventional Loan in Orange County, CA

April 15, 2012 by Tim Storm 3 Comments

A VA refinance can be a great way take advantage of low interest rates in 2012, even if your Orange County property has lost most of its equity. It is possible to refinance into a VA loan from a non-VA loan up to 100% loan to value. Not only that, the VA loan limits are high. And VA 30 year fixed rates are low, even lower than most Conventional loan programs. The VA 100% financing limit in Orange County and Los Angeles County in 2012 is $621,000. But it possible to get a VA loan up to a loan amount of $1,500,000 with far less equity than a typical Jumbo lender would require.

Orange County 2012 VA Loan Limits

Near the end of every year VA will announce their new loan limits. In 2012, the loan limits for Orange County is $621,000 up to 100% of the properties value. While most lenders will only allow a refinance up to 90% of the VA limit, there are lenders who do allow a refinance to 100% of the properties value, as long as the loan is within the 100% financing limit. While there are many eligible Veterans in Orange County, many of them are aware of the benefits of the VA program when it comes to refinancing. But with the drop in property values, more Orange County Veterans, who initially bought their home with Conventional financing, are finding that they can save hundreds per month by taking advantage of their VA benefits.

For example, an Irvine homeowner who financed their home in 2008 with a $500,000 Conventional 30 year fixed loan at 5.5% would have a payment of $2,838. Let’s assume the property was worth $600,000 in 2008. Now, 4 years later, the loan balance is down to approximately $470,000 and their property is also now worth $470,000. Their lender won’t refinance them since they don’t have 20% equity, and they also are not eligible for the HARP refinance program since their loan is not Fannie Mae or Freddie Mac.As of April 2012, VA interest rates are ranging between 3.75% (4.016 APR) and 4.25% (4.492 APR). Let’s assume the homeowner chooses a VA loan at 4%, which also allows for all closing costs to be paid using a lender credit. There is a VA Funding Fee equal to 2.15% based on this Veterans first time use of the VA eligibility. They end up with a new loan of approximately $480,000 (Funding Fee was $10,000). Their principal and interest payment would drop to $2,296, a $541 monthly savings. If the Orange County VA borrower was to continue to make the save payment on their VA loan as they were making on their 5.5% Conventional loan. They would end up paying their loan off 5 year sooner, savings over $175,000 over the life of the loan. This is only possible because of the flexibility of the VA loan program.

Jumbo VA Loan in Orange County to $1,500,000

This also works for loan amounts over the 100% financing limit. It is actually possible to get a VA loan up to $1,500,000. While 100% financing is not allowed over the $621,000 limit, very little equity, especially compared to a normal Jumbo loan program, is required. To figure out the loan amount allowed, take 75% of the difference between the properties value and the Orange County 100% limit of $621,000. Add the difference back to $621,000 and that is the base VA loan amount. For example, let’s say a Newport Beach homeowner who is VA eligible owes $1,000,000 on a home that is worth $1,221,000. By taking 75% of the difference between $621,000 and $1,221,000 ($600,000 x 75% = $450,000) and adding it back to $621,000, we find the base VA loan will be $1,071,000. This means the Newport Beach Veteran can refinance his VA loan up to 87.7% of the properties value, and at a great 30 year fixed rate with no monthly mortgage insurance. There is not a Jumbo lender out there that will even touch this program. But again, the key is the borrower need to be VA eligible.

The property does need a termite inspection and and items on the termite report cleared prior to funding. VA also requires an impound account for property taxes and insurance. Besides that, there are many benefits to a the VA refinance.

Refinance to 100% loan to value with no mortgage insurance.
Combine a 1st and 2nd mortgage or equity line up to 100% loan to value.
Pull cash out up to 95% of the properties value.
Refinance a st mortgage and “subordinate” a 2nd mortgage to 115% of the properties value.
Very low 30 year fixed rates and 5 year ARM’s
Flexible qualifying – relatively high debt to income ratios

While most Orange County property owners are not eligible for VA financing, those that are should research their options when they are looking to refinance. Finding a knowledgeable Orange County VA lender is an important step in determining whether a VA refinance is a viable option. The VA lender should be able to provide a detailed custom analysis that compares your current loan to a new VA loan.

Authored by Tim Storm, an Orange County, CA FHA and VA Loan Officer – Please contact my office at Emery Financial for more information about an Orange County, CA home loan. Direct: 949-829-1846 MLO 223456

Filed Under: VA Cash out Refinance, VA Refinance Loans Tagged With: california va loan refinance, jumbo VA loan, jumbo va loan refinance, orange county va refinance

CalVet Loan or VA Loan | Which is Better for Orange County Veterans

September 26, 2011 by Tim Storm Leave a Comment

The CalVet loan program or the standard VA loan; which is better? It all depends on when the question is being asked and where you plan to buy a home. There are several distinct advantages the standard VA loan program has as of right now, September 2011, over the CalVet loan program. The biggest factor pushing most Veterans and active duty military personnel into the standard VA loan program is interest rate. But there are differences in loan limits which can sometimes favor the CalVet program depending on the California county the Veteran is purchasing in.

Low Interest Rates Favor the VA Loan Program

2011 has been a banner year for low interest rates. In September 2011, interest rates even hit all time lows. VA 30 year fixed rates are averaging 3.75% (3.98% APR)APR to 4.25% (4.48% APR) this year. VA interest rates have been consistently low for the last several years. CalVet loan program interest rates range from 5.5% (5.9% APR) to 5.95% (6.36% APR), which is a full 1.75% spread over the standard VA loan progam interest rates. To show what that interest rate spread does to the payment, lets compare a $300,000 loan. At 4%, the payment is $1,432. At 5.5%, the payment is $1,703. That is a $271 monthly payment difference, in favor of the standard VA loan program.

VA Loan Limit in Orange County is $700,000 | CalVet is $521,250

The VA loan limit for 2011 in Orange County, CA is $700,000, meaning a Veteran can purchase a home with Zero Down in Orange County (and Los Angeles) up to a $700,000 purchase price. A Veteran can even go with a higher priced home by bringing in a small down payment. The CalVet loan program caps out at $521,250. So for Orange County homebuyers looking at properties above a $521,250 price, who are undeterred by the higher interest rate a CalVet loan has, would still go VA because of the high loan amounts allowed.

VA vs CalVet | Homeowners Insurance

One advantage CalVet does over VA is a comprehensive homeowners insurance policy, which includes guaranteed replacement for your home, even in natural disaster situations like an earthquake or flood. Private insurance companies will charge extra for this type of coverage, and “guaranteed replacement” in California is very difficult to come by.

CalVet Does not offer a Refinance Program

CalVet requires that you apply for the loan before taking title to the property. Translated, this means it is only for a purchase, not a refinance. In contrast, VA offers the IRRRL program, or Interest Rate Reduction Refinance Loan. With this program you can lower your rate (if rates drop) without needing a full appraisal and without needing to qualify. It is a very “streamlined” process. However, it is only for current VA loan borrowers. For those Veterans who wish to refinance into a VA loan from a Conventional or FHA loan, they would need an appraisal and full income documentation. But the good news is they could refinance up to 100% of the properties value.

CalVet offers home Improvement loans up to $150,000 at competitive rates, which is a nice feature. VA does not currently have a home improvement loan program. However, another option is to use the FHA 203K Rehab loan program, which can later be refinanced into a VA loan.

VA Loan Versus CalVet Loan | Which is Better?

It depends. For most Orange County Veterans, the standard VA loan program is the way to go. Lower interest rates and higher loan amounts are two benefits that are hard to ignore. But it is important to keep abreast of changes. Who knows. VA could lower the 100% financing limit in 2012. Or interest rates, which change daily, could go up for the VA program. It is important to consult with an Orange County, CA VA loan expert who can prepare custom loan scenarios based on a Veteran’s qualifications. The VA loan expert can then help the Veteran get a VA Loan PreApproval.

www.OCFHALoans.com

Call our office today and see how we can help you and your family.

tstorm (at) ochomebuyerloans.com

Filed Under: VA Purchase Loans Tagged With: california va loan, calvet, orange county va loan, VA Loan, va loan program

Lower VA Funding Fee will Benefit Orange County, CA VA Loan Borrowers

September 21, 2011 by Tim Storm 1 Comment

Good news for Orange County, CA Veterans as the Department of Veterans Affairs announced that the Funding Fee on VA loans will decrease. VA Circular 26-11-12, released on September 8, 2011, gives the breakdown of the decrease, which could save Orange County homes buyers using the VA loan program throusands of dollars, depending on the purchase price of the home they are buying. The new Funding Fee rates go into effect for all loans closed on or after October 1, 2011, and is in effect for 12 months.

VA Funding Fee Chart for Loan Closed On or After October 1, 2011

Example of Benefit to Orange County, CA VA Loan borrowers

How much will this be a benefit to Orange County home buyers using VA financing? Well, because home prices tend to be on the high end in most parts of Orange County, the lower Funding Fee percentages will save thousands. For example, an Orange County Veteran purchasing a home in Irvine for $500,000 with no down payment, and using their VA eligiblity for the first time, would need have a Funding Fee of $10,750 added to their loan. ($500,000 * 2.15% = $10,750.) Using the new percentage, the Funding Fee would only be $7,000. ($500,000 * 1.4% = $7,000.) That saves this Irvine Veteran$3,750. The Funding Fee is financed into the loan, so the Veteran won’t actually feel the savings immediately, but there will be an effect on the monthly payment, in this case about $35 per month.

VA Loan PreApproval is the First Step

The first step in determining how this change will effect your purchase is to contact a local Orange County VA lender. A VA loan specialist will be able to prepare custom loan scenarios based on your qualifications and payment comfort level. The scenarios will give you a complete breakdown of the purchase price, loan amount, payment, closing costs, and amount needed to close. If you are planning on going with a “VA NO NO“, where you not only don’t come in with a down payment but also have the seller pay your closing costs, the scenarios will let you know how much of a seller credit is required. It is also possible to adjust the interest rate in order receive a lender credit towards closing costs. Your financing should be determined prior to making offers on homes.

Filed Under: VA Mortgage Tagged With: funding fee cahrt, lower funding fee 2011, orange county va loan, va loan program

2011 VA Loan Limits for Orange County, CA Good Through December

September 7, 2011 by Tim Storm 1 Comment

The 100% VA financing loan limit in Orange County, CA for 2011 is $700,000. The limit is typically changed, either up or down, at the end of September of each year. And while Fannie Mae, Freddie Mac, and FHA loan limits in Orange County will all be dropping from $729,750 down to $625,500, the Department of Veteran Affairs announced the VA loan limits will be extended through the end of 2011.

How Does This Effect the Maximum VA Loan Limit?

It is important to note that there is not a “maximum” VA loan limit. There IS a maximum “guaranty” provided by VA for loans meeting VA guidelines. In Orange County, a Veteran can still purchase a $700,000 home with no down payment. If the Veteran or Active Military wants to purchase a home for more than the 100% limit ($700,000), then a down payment is required. The down payment is equal to 25% of the difference between the $700,000 VA 100% financing limit and the higher purchase price. For example, if the purchase price will be $800,000, then the down payment required would be $25,000, or 25% of the difference between $700,000 and $800,000.

While there is not a maximum “loan limit”, most lenders will not lend above $1,500,000. Still, the VA program has provided a great way for Veterans to refinance their Convention loan to a low 30 year fixed rate, even when they have lost equity in their home. A “Jumbo” 30 year fixed rate is typically .75% to 1% higher than the going VA 30 year fixed rate.

Will the 100% Financing Limit in Orange County go Up, or Down, in 2012?

The Veteran’s Benefits Improvement ACT of 2008 provided a temporary increase in 100% VA financing limits for loans closed from January 1, 2009 through December 31, 2011. In 2008 the limit was only $417,000. In 2009 the limit increased dramatically to $737,000 in Orange County. In 2010 the limit dropped to $593,750, and in 2011 went back up to $700,000. Right now it is tough to tell what will happen with the VA loan limit. It most likely won’t go up. Based on what is currently happening with the Fannie Mae/FHA loan limits, the better guess is loan limits will drop. But how far? We should have a better idea within the next few months.

Veterans Purchasing Luxury Homes in Orange County Should Act Now

Because of the uncertainty regarding the Orange County 100% financing VA loan limit, Veterans who are considering a purchase of a home greater than $417,000 should get serious about finding a home before the end of 2011. The first step in determining eligibility and qualifications is to contact an Orange County Direct VA lender. The lender should be able to quickly retrieve your Certificate of Eligibility, as well as provide customized loan scenarios which will give the Veteran the details of a transaction that are needed when planning for a large financial event.

Authored by Tim Storm, an Orange County, CA FHA and 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 Mortgage Tagged With: 2011, jumbo VA, Orange County, VA Loan, va loan limits, va refinance

VA Loan Requirements & Eligibility for Orange County Veterans

July 26, 2011 by Tim Storm

(Updated for 2018) A common question among Orange County Veterans is “what are the VA loan requirements” and “am I eligible“. Because for several years in Orange County, the VA loan limits were too low to help a Veteran purchase a home, the VA program was seldom used. But now, with the $0 down loan limit in 2018 at $679,750, the VA loan program has become very popular. With low 30 year fixed rates, no down payment requirements, and flexible qualifying, any active duty military or Veteran thinking of purchasing a home in Orange County should learn about the VA loan program and the benefits it provides.

Eligibility Requirements for VA Loan Program

Orange County Veterans with active duty service (who were not dishonorably discharged) during World War II and later periods are eligible for VA loan benefits. World War II (September 16, 1940, to July 25, 1947), Korean conflict (June 27, 1950, to January 31, 1955), and Vietnam era (August 5, 1964, to May 7, 1975) veterans must have at least 90 days of service.

Orange County Veterans and active duty military personnel who served during peacetime must have had more than 180 days of active service. Veterans of enlisted service starting after September 7, 1980, or officers with service beginning after October 16, 1981, must in most cases have served at least 2 years.

The VA does not require that you have a certain credit score in order for approval. Mortgage lenders, however, are allowed to set their own standards for VA loan requirements. Most Orange County direct VA lenders require a minimum FICO score of 620 for loan amounts under $453,100. For loan amounts over $453,100, known as “high balance VA loans”, the FICO may need to be higher.

Since early 2010, most VA lenders in Orange County, and throughout the country, have tightened their lending and credit score requirements, making home financing harder to come by for those with credit issues or other criteria that makes their loan riskier.

To learn more about this, our article Credit Score Requirements For Orange County, CA VA Mortgages is a great place to start.

There are three specific pieces of documentation a lender will need to determine your eligibility:

A DD214 for discharged veterans.

A statement of service for active military personnel.

A Certificate of Eligibility (COE) to determine you have VA entitlement. Most Orange County VA lenders can quickly retrieve your Certificate of Eligibility on your behalf.

Because each VA lender has different qualifying guidelines, the next step is to contact your local Orange County VA loan expert to find out if you meet their VA loan requirements such as minimum FICO/credit scores, debt-to-income (DTI) ratios, and find out what your California county’s maximum loan amount is.

Lastly, if you have either had a divorce, filed bankruptcy, or had a previous home go into foreclosure, you are not immediately disqualified from a VA loan, although there are some additional restrictions.

You can find more information regarding these topics in our articles titled Divorce And VA Loan Eligibility, Does A Bankruptcy Mean I Can’t Get A VA Loan? and Can I Get A VA Loan If I’ve Had A Recent Foreclosure?

Call our office today and see how we can help you and your family.

tstorm (at) ochomebuyerloans.com

Filed Under: VA Mortgage Tagged With: california, Orange County, preapproval, VA Loan, va loan eligibility, va loan requirements

Are There VA Jumbo Loans Available in Orange County, CA?

April 23, 2011 by Tim Storm

If you’re looking at buying the Orange County home of your dreams then a Jumbo VA mortgage loan may be the best option for your financing.

In most VA loan scenarios, the VA guarantees up to 25% of the total amount of the loan up to the VA loan limit in your county – which, in much of the US, is $453,100 in Orange County, CA the 100% financing limit is $679,650. (2018 loan limit) That is a high limit and will surely purchase a beautiful home, but what if you can afford more?

But what happens when the value of the loan exceeds the Orange County $679,650 loan limit for 100% Financing?

This is where the Orange County, CA VA jumbo loan becomes a great option.

As an example, let’s say that you would like to live in Newport Beach, where home prices are easily higher than $1,000,000. You find the perfect house for you and your family, and it’s selling for $1,079,650, which is $400,000 over the Orange County 100% VA financing limit. You decide that you would like to use your hard-earned veteran benefits to take out a VA mortgage!

The U.S. Department of Veterans Affairs mandates that on jumbo loans above the 100% financing county loan limit, the borrower put down 25% of the difference between the cost of the loan and the applicable county VA loan limit.

Continuing on with our VA jumbo loan example from above, 25% of $400,000, $100,000 would be required as a down payment.

Not bad at all! In this example you’re buying your $1,100,000 Newport Beach home for only $100,000 down in addition to the required closing costs. Better yet, you are getting a low 30 year fixed rate. Your rate will be at least 1% lower than a non-VA borrower would get for a $1,000,000 loan.

The real value of VA jumbo loans is apparent when you compare it to the standard down payment requirement of a conventional or in this case, a Portfolio Jumbo loan mortgage, which is typically 20% down minimum. And again, VA offers a low 30 year fixed rate. Try finding a low 30 year fixed rate on a Portfolio Jumbo loan program.

This means that for the example of a $1,079,650 Orange County house, a conventional loan down payment would be $215,930 (at the minimum) while a VA loan down payment would only be $100,000. That’s less than half of the down payment required for the conventional loan in this scenario!

Please keep in mind while house shopping that VA county loan limits vary widely throughout the country and will be higher in areas with especially high property values. Once again, the Orange County VA county loan limit is $679,650, but it’s smart to check with your local VA mortgage agent prior to looking at houses. Many parts of California max out at $453,100 in 2018.

For example, as of 2018 the VA county loan limit for Marin County is $679,650! San Francisco County also has a loan limit of $679,650.

To check the Southern California VA loan limits, click on the blue link. To check what the VA county loan limits are for each county in the United States, you can visit the U.S. Department of Veterans Affairs at their loan limit website. For counties that are not listed on the website, the official California VA loan limit is automatically set at $453,100 in 2018.

Why is there such as large difference in county loan limits throughout the nation? In short, because the various housing markets across the country vary greatly.

In San Francisco a small single-family house may sell for $1,000,000, while in other places you might be able to find a similar house for $100,000!

Wherever you are, if you are in need of a substantial home loan, a VA jumbo loan is certainly worth checking out.

Authored by Tim Storm, an Orange County, CA FHA and 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

tstorm (at) ochomebuyerloans.com

*updated January 3, 2018

Filed Under: VA Mortgage, VA Purchase Loans Tagged With: jumbo mortgage, va jumbo loan, va jumbo mortgage, VA Loan