The VA loan limits in Orange County for 2014 will be $687,500. The Veterans Administration recently announced the 2014 VA loan limits and many counties in California saw an increase due to the improved real estate market and higher home prices in 2013. While most of the country, including many counties in California, will continue to have their limit set at the Conforming limit of $417,000, “higher priced” counties have higher VA loan limits.
What Makes Orange County “High Priced”?
The obvious answer to the question of why Orange County qualifies for high loan limits than most of the country is because of the high average cost of a home compared to other areas. While the Median home price in Orange county is above $500,000, most of the country’s median price is under $400,000. Other counties surrounding Orange County also have higher limits, including Los Angeles ($687,500) and San Diego ($546,250). It is important to note that this limit is for 100% financing. It is still possible to get a VA loan that is above the 100% limit.
Jumbo VA Loan in Orange County
When a loan amount is above the 100% limit it is commonly known as a Jumbo VA loan. Since the VA loan limit in Orange County for 100% financing is $687,500, then an VA loan above that amount is considered to be a “Jumbo VA Loan“. If a Veteran is purchasing (or refinancing) a home in with a sales price (appraised value) above $668,750 and they intend to get maximum financing, then they will need a down payment equal to 25% of the difference between the 100% loan limit of the purchase price. For example, if a Veteran is buying a home in Irvine, CA for $787,500, or $100,000 above the VA loan limit, then the Veteran would need a down payment of $25,000. Only $25,000, or 3.17% down payment. There is no better loan program than VA when it comes to low down payment and competitive fixed interest rates.
The first step in determining whether a VA loan is right for you is to contact a local Orange County VA loan specialist. The VA loan officer should be able to prepare custom VA loan scenarios after a quick phone conversation. The scenarios will give a detailed breakdown of the purchase price, loan amount, and costs involved in the home buying process. Also, your Orange County VA loan specialist should also be able to provide a video explanation of the scenarios, which will help to understand the scenarios as well as share them with other family members or financial advisors.
Authored by Tim Storm, a California Mortgage Loan Officer MLO 223456 – Please contact my office at the Emery Financial. Direct line at 949-640-3102. www.OrangeCountyVALoans.com
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
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tstorm (at) ochomebuyerloans.com