by Phil Georgiades
In June 2019, United States President Donald Trump signed the Blue Water Navy Vietnam Veterans Act of 2019. The program aims at providing benefits to veterans who might have been exposed to dangerous chemicals during their deployment, as well as their families. In addition, the program also made changes to the VA home loan program.
Funding Fee Changes
These changes included a temporary VA Loan funding fee change which raised the funding fee of 0.15% to 0.30% for Veterans and servicemembers. While at the same time the funding fee was lowered for National Guard and Reserve members. Furthermore, this temporary funding fee change is currently set to last for the next two years.
Purple Heart Recipients
Veterans with disabilities who were not subject to the funding fee were not affected by the program. However, active-duty service members who have earned a Purple Heart can now have their funding fee waived so long as they close on their home while still on active duty.
Loan Limit Removal
The new law has completely removed loan limits for Native American Veterans who a looking to build or purchase a home on Federal Trust Land.
In addition, the program has also removed the limits on zero down payment VA loans for qualifying veterans, service members, and surviving spouses. As a result, it enabled them to purchase homes in more affluent communities. In addition, VA loans can also be used to make improvements to your current home, purchase a manufactured home, or buy a condo so long as it is VA approved.
It is important to note that lenders must still do their due diligence to make sure that borrowers can make their monthly mortgage payments. In addition, their income must be enough to cover compensating factors like food and other daily necessities. As a result, VA loan lenders can still set limits as to how much they’re willing to loan the borrower. VA home loans have a current limit of $5,000,000 VA loan with $0 down.
Those with more than one VA Loan
People who have more than one VA loan currently open are still limited by their county’s loan limit. On average, the loan limit for applicants with more than one loan is $510,400. However, certain counties might have higher loan limits, depending on the average housing value for that specific county.
Benefits from VA Loans
There are several benefits to having a VA home loan like no down payment options, low monthly costs, low-interest rates, no mortgage premiums, no-prepayment penalties, and 15 to 30-year fixed mortgages. In addition, the VA loan program is also amongst the easiest to qualify for. Moreover, VA home loans are backed and guaranteed by the United States Government. Therefore, guaranteeing lenders that if a borrower defaults on their VA home loan, the Department of Veteran Affairs will repay part of it.
Qualifying for a VA Home Loan
Once a candidate decides to get a VA home loan, they will be taken through the pre-approval process which will determine their eligibility, and what home they are qualified for.
Being eligible for a VA loan will depend on one of these basic service requirements being met.
- Must have served at least 90 consecutive days of active duty service during wartime.
- Must have served at least 181 days of active duty service during peacetime.
- Have at least 6 years of service while in the National Guard or Reserves.
- Being the spouse of a service member who lost their life in the line of duty or as a complication resulting from a service-related disability.
There are certain income requirements that must be met before applying for a VA loan. Qualifying incomes include social security, VA disability, full-time job, part-time job, self-employment, seasonal income, alimony, rental income, and child support income.
Different lenders have different requirements for what is considered a qualifying credit. While some lenders require a minimum of 640 credit score, there are certain lenders who are willing to work with credits that are lower than that. In addition, other aspects that will be taken into consideration for whether an applicant’s credit qualifies to include collections reporting, late payments, and current mortgages.
Before you’re able to move forward with moving into a home, the house must go through the VA appraisal process to make sure that it meets the minimum property requirements. Moreover, qualifying properties include single-family residences, multi-family dwellings, condos, townhomes, manufactured, and mobile homes.
Certain Restrictions apply per category and VA home loans will be happy to help with making sure that you qualify for your dream home.
Apply for a VA Home Loan
VA Home Loan Centers will be happy to help you with every step of the process. Start the process and apply for a VA home loan today and achieve the dream of being a homeowner.
Phil Georgiades is the CLS for VA Home Loan Centers a government-sponsored brokerage specializing in VA Home Loans. He has been practicing real estate for 22 years.