IF YOU'RE A VETERAN WANTING TO PURCHASE A HOME, YOU HAVE DEFINITELY COME TO THE RIGHT PLACE !
FIRST THINGS FIRST
(Obtain your COE-Certificate of Entitlement)
What’s a Certificate of Eligibility?
As a Veteran, your Certificate of Eligibility (COE) determines whether you can participate in the VA loan program. It also lets you know your VA loan entitlement amount. But what does that mean? Does your VA entitlement amount limit how much you can borrow? It all depends on your individual situation. Assessing your entitlement is where to start. We can help you get your COE. Call Chuck
Next we're going to get qualified with an honest Mortage Company. Call Chuck
Understanding Your VA Loan Limits
You’re thinking about applying for a VA loan and want to gain a greater understanding of just how much you can borrow. The process may seem a little confusing, but don’t let that discourage you. I can walk you through every step of the way.
Call Chuck
Big changes on loan limits.
Due to legislation called the Blue Water Navy (BWN) Vietnam Veterans Act of 2019, starting in 2020 the rules on VA loan limits changed to help Veterans. For example, the yearly VA loan limits review is no longer in place for many. Instead, Veterans enjoying full entitlement (those who have no eligibility tied up in other properties with a VA loan) have no loan limits to the amount they can borrow. For Veterans with partial entitlement (those who currently have a home with a VA loan or have lost a home due to foreclosure, bankruptcy, etc.), your loan limit is based on the maximum eligibility in the county where the home you are purchasing is located.
If you have partial entitlement, the maximum VA guaranty on your combined VA loans cannot exceed 25 percent of the loan limit for the area in which you are buying to utilize 100 percent financing. This means you may be able to enjoy a $0 down payment VA loan, but the available entitlement must be at least 25 percent of your loan. You are able to exceed this amount, but a small down payment may be required.
What does full entitlement mean?
Veterans with full entitlement do not technically have a loan limit. You can borrow up to what your lender is willing to loan you, based on factors like credit history, income, and assets and what you can afford. You have full entitlement if you meet any one of these requirements:
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You’ve never used your home loan benefit, or
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You’ve paid a previous VA loan in full, sold the property, and put in a request for the VA to restore your entitlement (this would restore your full entitlement, more on this later), or
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You’ve used your home loan benefit, but had a foreclosure or compromise claim (a.k.a. “short sale”) and repaid the loan in full
If your COE reads, “This Veteran’s basic entitlement is $36,000,” then you have full entitlement. Just know that figure doesn’t represent the total amount you can borrow. It means that if you default on a loan that’s less than $144,000, the VA will guarantee your lender a return of up to $36,000. For loans exceeding $144,000, the VA guarantees to pay the lender up to 25 percent of the loan amount if you default.