VA Purchase Loans | Orange County, California VA Loans - Tim Storm

Who is Exempt from the VA Funding Fee?

February 20, 2018 by Tim Storm

The VA Funding Fee is unique to the VA mortgage program. The funds from this fee go directly to the VA to help cover any losses from loans that default. The VA funding fee is an amount equal to a certain percentage of the loan amount which is based on a variety of factors. These factors include the type of military service performed, whether a down payment is going to be paid with the loan, and if this is the first time using the VA program or a subsequent use. The borrower has the option to either pay the funding fee in cash at closing or to include the funding fee into the financed loan amount. It is extremely rare that a Veteran chooses to pay the VA Funding Fee out of pocket versus financing it into the loan, but it is possible.

Funding Fee Exemption

The VA does allow exemptions to the Funding Fee, but only for a few eligible groups. The main group that is exempt from paying the VA funding fee are veterans that have a service-connected disability rating. The other group that is exempt are surviving spouses of Veterans who died in the service, or as a result of service-related disabilities.

These two charts below include some addition information regarding how the percentage paid for the VA funding fee is determined. This first chart provides information for VA purchase loans:

This second chart provides the percentage details for VA cash-out refinance loans:

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 your scenarios so that you are able to fully understand the numbers BEFORE you have started the loan process.

Filed Under: VA Mortgage, VA Purchase Loans Tagged With: exempt from funding fee, va funding fee

The Easiest Way to Get Your VA Certificate of Eligibility

January 30, 2018 by Tim Storm

Yes, there is an easy way to retrieve your VA Certificate of Eligibility. Obtaining a Certificate of Eligibility (COE) is an important step in the VA mortgage process. The COE states your eligibility and is validation for your military service for the VA mortgage program. When it comes to getting your COE for your VA loan, you can either request it yourself or allow the lender you will be using for financing to request it.

VA Approved Lender Can Retrieve Certificate of Eligibility in Seconds

If you wish to request it yourself, you can either use the VA Online eBenefits portal, visit a nearby regional loan center or mail in necessary documents. But having an Orange County VA lender obtain your COE for the loan is a faster and simpler process. All you need to do is provide your lender with proof of service (DD214), and they are able to use the Automated Certificate of Eligibility (ACE) portal provided by the VA. Using this automated portal, lenders are able to obtain your Certificate of Eligibility in a matter of seconds. There will be some cases where the automated portal will be unable to make a decision on eligibility but it will still be a faster process for your lender to get the COE.

Providing Proof of Service

Whether you go about getting your Certificate of Eligibility yourself or have your lender do it, you may need to provide proof of service. Form 26-1880 may need to be completed if your lender is not able to get the COE on the first try. Also, the DD214 will need to be turned in to the lender if the COE is not retrieved on the first try. For the VA loan program, copy 4 of the DD-214 is preferred because it is the most detailed regarding your service. Reserve and National Guard members need to send in their most recent annual retirement summary with proof of honorable service attached. If you have been discharged from active duty and don’t have a proof of service form, you can still submit a request for a COE because in some cases the VA can determine your eligibility based on their own records.

What if your Certificate of Eligibility shows “Zero Entitlement”

There are situations where the COE will show no entitlement remaining. And this is where working with an experienced VA loan officer can save you a lot of money. Having Zero Entitlement does not necessarily mean you can’t buy a home with $0 down payment. Even if your $0 down loan limit is severely limited, it still doesn’t mean VA is not a viable option when compared to other loan programs. Bonus Entitlement can cover a Veteran with no entitlement.

Okay, so now that you have your Certificate of Eligibility, now what? Now it’s time to have your VA lender work on your VA Loan PreApproval. Before you even begin looking at homes you need to find out what loan amount you qualify for and are comfortable with. A good VA lender should be able to put together a detailed breakdown of the numbers for you, making sure you are well prepared for going through with a home purchase.

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: certificate of eligibility, coe

Why choose a VA loan for your Orange County Home Purchase?

January 23, 2018 by Tim Storm

Purchasing a home in Orange County is a challenge for most people, but the VA mortgage program provides a great benefit to Veterans here in Orange County and across the country. The Department of Veterans Affairs acts as an insurer for approved lenders that minimizes the risk of the loan. The VA guarantee also results in lower interest rates compared to other types of financing. It also allows for no required down payment. The VA program has made financing a home significantly easier to obtain for Veterans who may not have been able to get a loan otherwise.

No Down Payment Required

One of the most significant benefits of the VA loan is that there is no down payment required. The Veterans Administration has established 100% financing loan limits based on the county you live in. Not requiring a down payment allows Veterans to save thousands of dollars and still obtain a loan. The 2018 VA Loan Limit for 100% financing in Orange County is $679,650.

No PMI – No Mortgage Insurance

Another major money saving benefit of the VA program is that there is no Private Mortgage Insurance (PMI) required with the loan. When there is a down payment of less than 20% on a loan, most Conventional programs will require PMI. The purpose of this requirement is to protect lenders against the risk of default. The VA mortgage program doesn’t require this because the VA already protects lenders against the risk of default. Not requiring monthly PMI can save Veterans hundreds of dollars per month.

Low VA Interest Rates Compared to other Loan Programs

Interest rates are of course a very important factor when it comes to financing a home. Due to the VA guaranteeing VA loans, lenders are able to offer veterans lower rates compared to other conventional loan programs. A lower interest rate can save veterans thousands of dollars annually and over the life of the loan.

Combined with all of these money saving perks, the VA program also doesn’t have a penalty for pre-paying on the principal of your loan. When it comes to buying a home, in most cases the VA mortgage program is by far the best option for Veterans looking to secure financing. The best way to find out how the VA loan program compares to other programs is to call a local Orange County Loan Officer who specialized in VA financing. The Orange County VA Loan officer will be able to prepare a Side by Side Total Cost Analysis of your loan program options, including a complete breakdown of the numbers involved in a home purchase.

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: va loan benefits, va purchase loan

4 Myths about the VA Loan Program in Orange County

January 8, 2018 by Tim Storm

The VA mortgage program is a fantastic benefit that has made the Orange County home buying process much easier for our Veterans. However there are a few myths and misunderstandings about the program that sometimes cause veterans to look at different programs when buying a home. Here are 4 of the most common myths about the VA program…

Myth #1: You need perfect credit for a VA loan

The VA acts as an insurer for VA loans to offset the risk of a potential default. VA does not have a minimum FICO score requirement. However, because VA loans are sold on the secondary market, lenders do have their own requirements. Many VA lenders will look for a credit score of at least 620. That 620 score is an arbitrary limit that is self-imposed by some lenders, so there will be some lenders that will close a VA loan with FICO scores of 580 or even lower. If you are looking for a VA loan and the first lender you visit won’t accept your loan request, it is worth looking to see if you can find a different lender that will accept your request. Also, VA only requires a 2 year wait period after a bankruptcy or foreclosure. And no wait period after a short sale.

Myth #2: VA loans take longer to close than other types of loans

The VA loan program has become a faster and more streamlined process. According to Ellie Mae, VA and Conventional loans both on average close in about 43 to 46 days (2017 statistic). On top of that VA loans are also more likely to close than a conventional loan. Because the VA loan program is a “niche”, Veterans should seek out lenders and loan officers who specialize in the VA loan program. An Orange County Loan Officer who specializes in VA loans should have no trouble closing a VA loan in 30 days or less. (or even 22 days)

Myth #3: VA loans are risky loans

The no down payment aspect of a VA loan may make it seem like it’s a much riskier loan. However, VA loans have the lowest foreclosure rate when compared to other Conventional programs. VA is unique in that not only is the Debt to Income ratio reviewed, but a Residual Income calculation is also reviewed. No other loan program reviews Residual Income in the way that VA does.

Myth #4: VA loans can only be used one time

Many Veterans in Orange County think that the VA loan program can only be used once or your eligibility expires after a certain period of time, which is simply not true. The VA program is a lifelong benefit that Veterans are able to use multiple times. Every Veteran has a “basic entitlement” with the VA loan program, which represents the amount of their loan guaranteed by the VA. Once their first loan has been paid off and their entitlement has been reestablished or restored, they are able to get another VA loan. On top of that, it is important to understand how Bonus Entitlement works and how it is possible for get a VA loan even if your Certificate of Eligibility shows “Zero” Entitlement.

For more questions about the VA loan program or to receive custom VA loan scenarios, please call Tim Storm at 949-640-3102.

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: va loan myths

VA Loan Limits Increase in Orange County, CA for 2018

January 4, 2018 by Tim Storm

VA loan limits for 100% financing in Orange County, CA will be higher in 2018, jumping from the 2017 limit of $636,150 up to a new limit of $679,650. This is a fairly significant increase that will help Orange County Veterans buy or refinance homes in Orange County, where homes prices increased in 2017 and seem to be continuing to go up.

$679,650 Purchase Price with Zero Down Payment

Orange County, CA is considered a “high cost” county in California, along with Los Angeles county. Buying a home in Orange County has been challenging as home inventory has not kept up with the number of buyers wanting to purchase a home. And while being able to buy a home for $679,650 with no down payment may sound too good to be true, it is possible for eligible Veterans and Active Duty military.

Orange County has one of the largest populations of Veterans in the country, but many Veterans don’t realize they are eligible for the VA loan program.

Question: What if a Veteran Wants to Buy a Home for more than $679,650?

The VA Jumbo Loan Program Explained

Although $679,650 will help Veterans in Orange County, what happens when the purchase price is above the Zero Down limit? The obvious, but incorrect, answer is the down payment would need to cover the difference between the purchase price and Zero Down limit. But the Jumbo VA Loan program is better than that. A down payment of only 25% of the difference between the purchase price and the loan limit is required. For example, if the purchase price is $779,650, or $100,000 above the Zero Down limit, the down payment would only be $25,000. The VA loan would be $754,650. That is a great deal for Veterans who can afford a higher priced home.

Refinancing into a VA Loan

The increased loan limits do not only effect purchase transactions. They also effect those who want to refinance into a new VA loan to pull cash out. Over the last few years there are many Veterans who bought homes and now would like to pull cash out for home improvements (or to cover debt that has built up on credit cards). The increased limits make it easier for those who were previously right at the 100% loan limit, especially when property values have also increased.

The first step in figuring out how the new loan limits can benefit you is to contact a VA loan specialist located in Orange County, CA. The VA program is unique, and working with a local VA loan specialist who understands what it takes to get a VA loan closed quickly on a high priced home (Single Family or VA approved Condo) is beneficial for the Veteran. The VA loan officer should be able to provide multiple loan scenarios with specific details on the numbers involved in a refinance or purchase.

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: 2018, orange county va loan limits, va loan limits