Orange County | Orange County, California VA Loans

Orange County VA Loan Limit for 2019 is $726,525

February 23, 2019 by Tim Storm

The VA loan limit in Orange County for 2019 increased once again to $726,525. In 2018 the limit had been $679,650. This $46,875 increase gives Veterans more reason to seriously consider the VA loan program even if they have a down payment. Home prices in Orange County are higher than in most parts of the country, making it difficult for home buyers, both Veteran and non-Veteran buyers, to finance the purchase of a home. VA offers the only 100% financing program with a limit to $726,525 and is only available to eligible Veterans.

Jumbo VA Loan Program – What is it and How Does it Work?

$726,525 is the 100% financing loan limit for Orange County, but is not the actual limit for the highest a VA loan can go. Many lenders will fund VA loan amounts as high as $1,500,000. A Jumbo VA loan is when the loan amount is higher than the 100% financed limit.A down payment is required when the purchase price is higher than the 100% financed loan limit, but it is minimal compared to other loan programs. The down payment is equal to 25% of the difference between the 100% financing loan limit and the purchase price. For example, if a Veteran is purchasing a home for $850,000 in Irvine, CA, the minimum down payment required would be $30,868. ($850,000 – $726,525 = $123,475. And 25% of $123,475 = $30,868). This means that a Veteran can purchase an $850,000 home in Orange County with only 3.63% down payment. The base VA loan amount would be $819,132.

Other Advantages of the VA Loan Program

There are several advantages the VA loan program has over most other types of home financing. They include:

No monthly Mortgage Insurance or PMI, even when the down payment is less than 20% (or $0)
Flexibility with Debt to Income Ratios – Many “Jumbo” loan programs limit the debt to income ratio to 43%. Some will go as high as 50%. Standard VA guidelines do not have a maximum debt to income ratio. It is not uncommon for a VA loan to be approved with the debt to income ratio being above 55% or even 60% in some cases. What is more important on a VA loan is the Residual Income calculation. *Debt to Income ratio is equal to a homebuyers total mortgage payment, installment payments (car, student loans, etc), minimum credit card payments, alimony, child support, etc divided by their total gross income before taxes. If a home buyer making $7,000 per month has a proposed mortgage payment of $2,500 and a car payment of $500, then their Debt to Income ratio is 42.8%. $2,500+$500 = $3,000. $3,000 / $7,000 = 42.8%
Short wait period after a bankruptcy or foreclosure. While Conventional loan programs typically require a minimum of 4 years wait period after a Chapter 7 bankruptcy and 7 years after a foreclosure, VA only requires a 2 year wait prior after a bankruptcy or foreclosure. It is important to reestablish credit after a significant credit event, but it is not unusual to see credit completely restored only 2 years after a major credit event.
Competitive 30 year fixed interest rates – While VA does not have an “interest only” loan program, VA does have very solid 30 year fixed loan programs with interest rates that can quite often be lower than other comparable loan programs.
Flexibility with FICO scoring. With Conventional loan programs, to get competitive loan pricing, the borrowers FICO score needs to be 740 or higher. With VA, there is very little difference in loan pricing between a borrower with a 740 FICO and a borrower with a 680 FICO. Even with a FICO of 620 it is possible for a Veteran to receive a competitive 30 year fixed interest rate.

Cashout Refinance to $726,525

The new loan limits will also help Orange County Veterans who already own a home and are looking to pull cash out for debt consolidation, home improvements, or almost any other purpose. VA allows “cash out” up to 100% of the property value up to the 100% loan limit. The new loan amount, including the VA Funding Fee, can be 100% of the property value. Also, properties valued higher than the $726,525 loan limit are eligible for even higher loan amounts. The formula for calculating the maximum Jumbo VA loan amount on a cash out refinance is similar to the formula for determining the loan amount on a Jumbo VA purchase. A Veteran who owns a home in Mission Viejo valued at $850,000 could get a new VA loan of $819,132.

Who is Eligible for a VA Loan?

You may be eligible for a VA loan if you meet one of the following conditions:

You have served 90 consecutive days of active service during wartime, or…
You have served 181 days of active service during peacetime, or…
You have more than 6 years of service in the National Guard or Reserves, or…
You are the spouse of a service member who has died in the line of duty or as a result of a service-related disability.

It is important to understand that the VA loan program is not only for First Time Buyers. It can be used multiple times and in some cases, a Veteran can have more than one outstanding VA loan. Your eligibility does not “expire”. Your VA lender will help you to retrieve your Certificate of Eligibility. All that is needed is a copy of your DD214. And in some cases, the lender may not even need that.

Step 1 in the VA Loan Process

The first step in the VA loan process is contacting a local Orange County, CA VA lender. Working with a Loan Officer who specializes in the VA loan program is important and will help to ensure that your VA loan has the best chance of closing with as little stress as possible. The lender should be able to answer your questions and prepare a custom VA Mortgage Analysis based on your goals and budget.

Authored by Tim Storm, an Orange County VA Loan Officer specializing in VA Loan. MLO 223456. – Please contact my office at Fairway Independent Mortgage Corporation. My direct line is 949-640-3102. I will 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.

Filed Under: VA Purchase Loans, VA Refinance Loans Tagged With: 2019, Orange County, va loan limits

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

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

Orange County VA Mortgage Loans

March 14, 2011 by Tim Storm

In Orange County, CA a VA (Veterans Administration) guaranteed home loan is the preferred loan program for active, non-active, Reserve, National Guard, and retired military of the armed forces. There are several reasons, including the fact that no down payment is required up to a $700,000 purchase price, and no private monthly mortgage insurance required.

Veterans and active duty military in Orange County are able to use a VA mortgage loan for purchasing a home, building a home, or refinancing an existing mortgage. And the existing mortgage does not need to be a VA loan. Many current Orange County homeowners are finding that being able to refinance out of a Conventional loan and into a VA loan at 100% loan to value is a great thing. And remember, no mortgage insurance, which FHA and Conventional loans will have.

We will discuss what role the VA plays in a VA guaranteed mortgage, the benefits of a VA home loan for Orange County Veterans and Active Duty personnel, who is eligible for a VA loan, and the documentation you will need to present to your Orange County VA direct lender in order to apply.

Did you know that more than 27 million veterans and service personnel are eligible for VA financing, yet many in Orange County aren’t aware it may be possible for them to buy homes again with VA financing using remaining or restored loan entitlement? The lack of realizing the benefits of a VA loan seems especially true for current homeowners who do not realize how high the Orange County VA loan limits currently are in 2011.

VA Does Not Offer Loans Directly to Orange County Veterans and Does Not Guaranty You Will Qualify

The VA does not actually lend the money to you directly. They offer a guaranty to a lender, in this case a local Orange County direct VA lender, that if you should default on the loan, they will pay the Orange County VA lender a percentage of the loan balance.

*The word GUARANTY does not actually guarantee the Orange County veteran will qualify for a VA home loan.

Primary Benefits of a VA Mortgage for Orange County Veterans:

100% financing, up to a $700,000 purchase price in Orange and Los Angeles counties.
No monthly private mortgage insurance is required. (Conventional financing requires this at over 80% loan to value. FHA requires this on all loans.)
There is a limitation on Orange County home buyers’ closing costs – costs are regulated by VA. Some costs cannot be paid by the Veteran.
The loan is assumable, subject to VA approval of the assumer’s credit. This is an awesome feature.
30 year fixed loan. VA also offers a great 5 year program, but with interest rates so low its hard not to take advantage of a 30 year fixed.
Seller can pay up to 4% of the Orange County veterans closing costs and even pay down they buyer’s debt to help lower their debt-to-income ratio.
Interest rates are similar to FHA interest rates.
You don’t need perfect credit. Typically, most Orange County VA lenders wants a minimum middle FICO score of at least 620. You can buy a home only two years after a foreclosure.

Frequently Asked Questions from Orange County Veterans about VA loans:

Q: My parent is a veteran. Can I obtain a VA loan if I have not served in the military myself?

No, the VA loan benefit does not extend to a veteran’s children.

Q: What is required to prove I served in the military?

You should have your DD214. Your lender will need this, along with a completed Request for Certificate of Eligibility. Your Orange County VA lender can help.

Q: My spouse who has passed away was an eligible veteran. Am I eligible for the home loan benefit myself?

A surviving spouse is eligible if they have not remarried, and the eligible veteran died during active duty service or as a result of a service-related disability.

Q: Is a VA loan better than a Conventional mortgage for Orange County homeowners and buyers?

In many cases, yes. VA guaranteed loans often offer a lower interest rate than conventional mortgages, especially for higher balance mortgages between $417,000 and $700,000, the Orange County 100% financing limit. Also, they do not require monthly private mortgage insurance when borrowing more than 80% of a home’s value, and they can be easier to get approved for because of the flexibility with credit and the allowance for higher debt to income ratios.

Q: How long does it take to get approved for a VA loan in Orange County?

It varies depending on the current workload of your lender, but it is typically the same as for Conventional and FHA mortgages – 3 weeks to 45 days. Much depends on your ability to quickly deliver the items required for loan processing. But if you’ve already been PreApproved by a local Orange County Direct VA lender, then closing in 3 weeks is a possibility.

Of course the first step is always to talk with a Orange County VA loan expert who can provide customized loan scenarios based on your qualifications and goals.

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: Orange County, VA Loan, va loan guaranty, VA Mortgage