As I’ve mentioned before, I’m not a mortgage broker — frankly, I don’t think real estate agents should be in that business — but I know enough about VA loans to say that any veteran purchasing a home with a mortgage should ask their lender whether a VA loan might be right for them.
This is particularly true for veterans with a 10% or greater disability, because for them the VA funding fee is waived, making a VA loan an easy choice over a conventional, FHA or even a jumbo loan.
A VA jumbo loan is one that is in excess of the conforming limit, which varies by county (the limit in Jeffco, for example is $493,350). You may think that the VA loan limit is that amount, but that’s merely the limit for 100% financing. You can borrow much more than that amount — up to $1.5 million — as long as you put down at least 25% of the difference between the purchase price and the VA limit.
The following useful information about VA loans was gleaned from the VA’s website:
VA home loans are provided by private lenders, such as banks and mortgage companies. VA guarantees a portion of the loan, enabling your lender to provide you with more favorable terms, including:
- No down payment as long as the sales price doesn’t exceed the appraised value.
- No private mortgage insurance premium requirement.
- VA rules limit the amount you can be charged for closing costs.
- Closing costs may be paid by the seller.
- The lender can’t charge you a penalty fee if you pay the loan off early.
- VA may be able to provide you some assistance if you run into difficulty making payments.
You should also know that:
- You don’t have to be a first-time homebuyer.
- You can reuse the benefit.
- VA-backed loans are assumable, as long as the person assuming the loan qualifies.
You must have satisfactory credit [Wells Fargo requires a credit score above 600], sufficient income, and a valid Certificate of Eligibility (COE) to be eligible for a VA-guaranteed home loan. The home must be for your own personal occupancy [not for a rental or investment property]. The eligibility requirements to obtain a COE are listed below for service members, veterans, spouses and other eligible beneficiaries.
VA home loans can be used to:
- Buy a home or a condominium unit in a VA-approved project
- Build a home
- Simultaneously purchase and improve a home
- Improve a home by installing energy-related features or making energy efficient improvements
- Buy a manufactured home on land
- To refinance an existing VA-guaranteed or direct loan for the purpose of a lower interest rate
- To refinance an existing mortgage loan or other indebtedness secured by a lien of record on a residence owned and occupied by the veteran as a home.
Fortunately, a VA regional loan center — one of only nine in the country — is located in Lakewood, at 155 Van Gordon Street. They should be able to provide you with the required Certificate of Eligibility.
Eligibility (visit http://benefits.va.gov/homeloans for more information) varies by the type and length of your military service, whether you are disabled or a surviving spouse who has not remarried.
Come to our VA Homebuyer Workshop Tonight!
Whether a VA loan is right for you is not always easy to determine, so Golden Real Estate has partnered with Wells Fargo to host a VA Homebuyer Workshop this Thursday, November 30th, from 6 to 7 pm, at VFW Post 1, 841 Santa Fe Drive, Denver. RSVP to Bernie Bernfeld at 303-273-6373, or call or text me at 303-525-1851.
Bernie specializes in VA loans for Wells Fargo and would be happy to answer your questions if you can’t attend the workshop.