orange county va loans | Orange County, California VA Loans

2017 Orange County VA Loan Limit Increase

January 20, 2017 by Tim Storm

VA has announced the increase of the 2017 VA loan limits.

What is the “VA loan limit“?

The Veterans Administration (VA) sets a limit of what a qualified Veteran buyer, with full entitlement, can borrow within each county without making a down payment. They calculate this limit based on the average price a home is selling for in that county. That means that in places like Orange County, CA the limit will be significantly higher than in a county with lower housing prices like Riverside County. This does not mean that you cannot purchase a home at a higher sales price (that would be a Jumbo VA Loan), just that you as the buyer, will be responsible for coming in with 25% of the difference between the loan limit and the purchase price. And if you think about it, that is a very favorable formula for those Veterans who want to purchase a home for a price higher than $636,150. Jumbo VA loans in Orange County, CA are fairly common.

“VA does not set a cap on how much you can borrow to finance your home. However, there are limits on the amount of liability VA can assume, which usually affects the amount of money an institution will lend you.” -Department of Veterans Affairs website

What the loan limit increase means for Orange County and Los Angeles County VA Buyers

This is an encouraging change for many prospective VA qualified buyers that have the income, satisfactory credit, appropriate debt-to-income ratios but may not have the savings for a conventional or FHA loan program. The VA loan limit for Orange and Los Angeles Counties is now at $636,150. That is up $10,650 from last years limit of $625,500. As housing prices increase in this popular area it is a welcome opportunity.

Let’s look at the highest purchase price for the new loan limit, showing a Veteran using benefits for the first time w/ 100% financing:

Purchase Price: $636,150 (<–Anything higher than this, the buyer will need a down payment equal to 25% of the difference between the loan limit and purchase price = Jumbo VA Loan)

Down Payment 0%

Base Loan Amt: $636,150

VA Funding Fee 2.15%: $13,677 – (assuming this is first time use for Regular Military with no Disability waiver)

Total VA LA: $649,827

We see that with the VA loan limit increase this year buying in Orange County or Los Angeles county now becomes a tangible option for more borrowers that are ready to take the leap into homeownership.

Do I have to have a VA funding fee? If so, what is it?

The VA Funding Fee is a set percentage, traditionally combined into the final loan amount, that will go directly to VA to help cover any losses accrued by loans going into default. The fee amount will change to accommodate the borrower’s unique circumstances. Some common factors to consider when calculating the amount would be purchase price, the nature of the borrower’s service, if they’ve had a previous VA loan, surviving spouse of a soldier, and if they choose to bring in a down payment. There are some Veteran’s that will not have a VA Funding Fee, if they receive service connected disability benefits from VA making them Exempt from the Funding Fee. Refer to the tables below to see which funding fee that would apply to your buying situation:

VA Funding Fee for Regular Military Borrowers
Down Payment	1st Use Funding Fee	Subsequent Use Funding Fee
None	2.15%	3.30%
5% – 10%	1.50%	1.50%
10% – Higher	1.25%	1.25%

VA Funding Fee for Reserves & The National Gaurd
Down Payment	1st Use Funding Fee	Subsequent Use Funding Fee
None	2.40%	3.30%
5% – 10%	1.75%	1.75%
10% – Higher	1.50%	1.50%

Bottom Line:

VA is certainly staying true to their “I CARE” values as they work to steadily adjust with the economy, and benefit the Veteran and military service members. They will effectively help many families to realize their dream of owning a home with an Orange County zip code this year.

Authored by Tim Storm, an Orange County VA Loan Officer specializing in VA Loan. MLO 223456. – Please contact my office at the Home Point Financial. My direct line is 949-640-3102. www.OrangeCountyVALoans.com. 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 the your scenarios so that you are able to fully understand the numbers BEFORE you have started the loan process.

Filed Under: VA Purchase Loans Tagged With: orange county va loans, VA financing, VA Loan, va loan limit

VA Loan Calculators | are they accurate for California Veterans?

May 18, 2016 by Tim Storm

Are VA loan calculators found on websites accurate? While a mortgage calculator can help in getting a quick idea of what a payment would be, in most cases they will not be accurate enough for what will be one of the biggest purchases you will make in your lifetime.

PITI – Principal, Interest, Taxes, Insurance

The total monthly payment on a VA loan is made up of a combination of several factors, including loan principal, interest, property taxes, homeowner’s insurance, and in the case of a condo, the Home Owners Association Dues.

Many mortgage websites contain a loan calculator that can be used to calculate an estimated monthly payment. Most of these calculators take into account most of the important values like purchase price, estimated down payment, and estimated loan term and interest rate. While these values play a big role in the calculation of your monthly payment, there are other factors that are involved in your monthly payment that these calculators either assume or don’t include.

Factors that can Affect the VA Loan Payment

The first of these factors that play a role in shaping a VA monthly payment are the calculation of the VA Funding Fee. Knowing whether the Funding Fee is 1.25%, 1.5%, 3.3%, or 0 is something that most online calculators do not account for. Whether or not a veteran has previously had a VA loan or if they are a disabled veteran factors heavily into the size of the VA funding fee, or whether there is a VA Funding Fee at all.

Other factors that play into determining a monthly payment include the property tax rate of the property (which will vary from one geographic region to the next) as well as the Homeowner’s insurance (earthquake insurance, flood insurance, rural area, etc). Each of these factors can vary by the area that you live in and may be different than the assumptions that the calculator is using.

What Does a California VA Loan Scenario Look Like?

With my clients I will always prepare a custom VA loan scenario, which will have a thorough breakdown of the Veterans payment, closing costs, and amount needed to close. Knowing these numbers in the early stages of the home buying process is crucial. I prepared a quick “screen capture” video which will show you what a VA loan scenario looks like. Click Here for the video.

While researching loan options and gathering information it is extremely beneficial to get an accurate loan scenario from a California VA Loan Specialist. A loan scenario will provide a full breakdown of all the factors that will play into shaping a VA loan and the monthly payment as well as being customized to your specific situation. A complete loan scenario will also give the California Veteran an accurate estimate of the amount of money to close to close, if any.

Filed Under: VA Purchase Loans Tagged With: orange county va loans, VA loan calculator, VA loan factors, VA Loans

VA Loan Program Will Be Popular in Orange County in 2011

January 6, 2011 by Tim Storm

VA loans will be even more popular in 2011 than in 2010 in Orange County. There are several reasons, besides the most obvious reason being that no down payment is required up to a $700,000 purchase price. Up until recently, Orange County Veterans did not realize the benefits that a VA loan program offered them.

Benefits of the VA Loan Program for Orange County Veterans

2011 VA Loan Limits are higher. 100% Financing up to $700,000 in Orange and Los Angeles Counties in 2011. This is actually an increase from 2010, when the 100% financing limit was $593,750. Even that was great, but $700,000 is better.
VA allows “cash out” refinancing up to 90% of the property value. This is much better than Conventional financing, which would have severe pricing “hits” for doing a “cash out” refinance at even 80% of the properties value on a loan amount under $417,000. Most Conventional loan guidelines consider combining a 1st and 2nd to be a “cash out” refinance. With the drop in property values since 2007, many homeowners have not been able to combine their 1st and 2nd mortgages because of the tight Conventional loan guidelines. But Orange County Veterans have the ability to combine their 1st and 2nd up to 90% of the properties value.
VA guidelines are more flexible when it comes to credit as compared to Conventional guidelines. Even if a Veteran has 20% down payment, a VA loan may be the best option if they’ve had a Short Sale, bankruptcy, or other credit issues in the past few years.
VA allows for higher “debt to income” ratios than Conventional financing. While Fannie Mae does not allow debt to income ratios above 45% without an exception, and even then will not go over 50%, VA is more interested in “residual income” that the debt to income ratios. On higher loan amounts this allows for quite a bit of flexibility.

Closing a VA Loan in Orange County is Easy

Closing a VA loan is much easier than some think. While the large banks can take 60 days or more to close a Conventional loan, a good Orange County Direct VA lender can close a VA loan in 30 days, maybe less. The key is to work with a Orange County VA loan Expert who knows what items are needed to complete the file, before the VA underwriter reviews the file. The VA loan expert should be able to provide accurate loan scenarios before the loan process starts, allowing the borrower to consider all options before paying for an appraisal.

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: orange county va loans, VA Cash out Refinance, VA Loan, VA Loans

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

Filed Under: VA Purchase Loans Tagged With: irvine va loan, lake forest va loan, orange county va loans, VA Loan, va loan limts, veterans administration