Orange County VA Loan Limit for 2019 is $726,525

2019 Orange County VA loan limitsThe VA loan limit in Orange County for 2019 increased once again to $726,525. In 2018 the limit had been $679,650. This $46,875 increase gives Veterans more reason to seriously consider the VA loan program even if they have a down payment. Home prices in Orange County are higher than in most parts of the country, making it difficult for home buyers, both Veteran and non-Veteran buyers, to finance the purchase of a home. VA offers the only 100% financing program with a limit to $726,525 and is only available to eligible Veterans.

Jumbo VA Loan Program – What is it and How Does it Work?

$726,525 is the 100% financing loan limit for Orange County, but is not the actual limit for the highest a VA loan can go. Many lenders will fund VA loan amounts as high as $1,500,000. A Jumbo VA loan is when the loan amount is higher than the 100% financed limit.A down payment is required when the purchase price is higher than the 100% financed loan limit, but it is minimal compared to other loan programs. The down payment is equal to 25% of the difference between the 100% financing loan limit and the purchase price. For example, if a Veteran is purchasing a home for $850,000 in Irvine, CA, the minimum down payment required would be $30,868. ($850,000 – $726,525 = $123,475. And 25% of $123,475 = $30,868). This means that a Veteran can purchase an $850,000 home in Orange County with only 3.63% down payment. The base VA loan amount would be $819,132.

Other Advantages of the VA Loan Program

There are several advantages the VA loan program has over most other types of home financing. They include:

  • No monthly Mortgage Insurance or PMI, even when the down payment is less than 20% (or $0)
  • Flexibility with Debt to Income Ratios – Many “Jumbo” loan programs limit the debt to income ratio to 43%. Some will go as high as 50%. Standard VA guidelines do not have a maximum debt to income ratio. It is not uncommon for a VA loan to be approved with the debt to income ratio being above 55% or even 60% in some cases. What is more important on a VA loan is the Residual Income calculation. *Debt to Income ratio is equal to a homebuyers total mortgage payment, installment payments (car, student loans, etc), minimum credit card payments, alimony, child support, etc divided by their total gross income before taxes. If a home buyer making $7,000 per month has a proposed mortgage payment of $2,500 and a car payment of $500, then their Debt to Income ratio is 42.8%. $2,500+$500 = $3,000.  $3,000 / $7,000 = 42.8%
  • Short wait period after a bankruptcy or foreclosure. While Conventional loan programs typically require a minimum of 4 years wait period after a Chapter 7 bankruptcy and 7 years after a foreclosure, VA only requires a 2 year wait prior after a bankruptcy or foreclosure. It is important to reestablish credit after a significant credit event, but it is not unusual to see credit completely restored only 2 years after a major credit event.
  • Competitive 30 year fixed interest rates – While VA does not have an “interest only” loan program, VA does have very solid 30 year fixed loan programs with interest rates that can quite often be lower than other comparable loan programs.
  • Flexibility with FICO scoring. With Conventional loan programs, to get competitive loan pricing, the borrowers FICO score needs to be 740 or higher. With VA, there is very little difference in loan pricing between a borrower with a 740 FICO and a borrower with a 680 FICO. Even with a FICO of 620 it is possible for a Veteran to receive a competitive 30 year fixed interest rate.

Cashout Refinance to $726,525

The new loan limits will also help Orange County Veterans who already own a home and are looking to pull cash out for debt consolidation, home improvements, or almost any other purpose. VA allows “cash out” up to 100% of the property value up to the 100% loan limit. The new loan amount, including the VA Funding Fee, can be 100% of the property value. Also, properties valued higher than the $726,525 loan limit are eligible for even higher loan amounts. The formula for calculating the maximum Jumbo VA loan amount on a cash out refinance is similar to the formula for determining the loan amount on a Jumbo VA purchase. A Veteran who owns a home in Mission Viejo valued at $850,000 could get a new VA loan of $819,132.

Who is Eligible for a VA Loan?

You may be eligible for a VA loan if you meet one of the following conditions:

  • You have served 90 consecutive days of active service during wartime, or…
  • You have served 181 days of active service during peacetime, or…
  • You have more than 6 years of service in the National Guard or Reserves, or…
  • You are the spouse of a service member who has died in the line of duty or as a result of a service-related disability.

It is important to understand that the VA loan program is not only for First Time Buyers. It can be used multiple times and in some cases, a Veteran can have more than one outstanding VA loan. Your eligibility does not “expire”. Your VA lender will help you to retrieve your Certificate of Eligibility. All that is needed is a copy of your DD214. And in some cases, the lender may not even need that.

Step 1 in the VA Loan Process

The first step in the VA loan process is contacting a local Orange County, CA  VA lender. Working with a Loan Officer who specializes in the VA loan program is important and will help to ensure that your VA loan has the best chance of closing with as little stress as possible. The lender should be able to answer your questions and prepare a custom VA Mortgage Analysis based on your goals and budget.

Authored by Tim Storm, an Orange County VA Loan Officer specializing in VA Loan. MLO 223456. – Please contact my office at Fairway Independent Mortgage Corporation. My direct line is 949-640-3102. 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.

VA Loan Limits Increase in Orange County, CA for 2018

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?FAQ on VA loans

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.

VA Loan Limits for Orange County increased in 2014

orange county va loan limits 2014The 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

2011 VA Loan Limits for Orange County, CA Good Through December

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

 

Contact us for your Orange County VA Mortgage:

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