VA loans are one of the most powerful mortgage options available to veteran and military homebuyers. The program boasts significant benefits, such as $0 down, no private mortgage insurance (PMI) and highly competitive interest rates.
Did you know, congress made changes to the VA program starting January 1, 2020? This means that veterans with full VA loan entitlement can now borrow the full loan amount without needing to factor in a down payment.
100% financing to $1,500,000
Prior to January 1, 2020, a veteran would need a down payment of 25% of the difference between the maximum county VA loan limit and the purchase price of the home. This is a huge win for veterans living in expensive housing markets.
Change the way you think of VA financing
Many real estate agents have not helped a veteran using VA financing or it has been a very long time. They think of a young man in a uniform buying at the entry level price range when in fact senior executives in corporations who have bought and sold many homes in their lifetime use VA financing to receive superior terms over conventional or Jumbo loans.
Case in point, one recently closed VA loan the executive had 20% down on a purchase price of $1,500,000. He had never used his entitlement and received a 30-year fixed rate loan at 3.125%. He had a service-related disability, so he did not have a VA funding fee added to the loan.
Relaxed underwriting guidelines allows for easier qualifying
Credit scores as low as 580, 2 year waiting period for foreclosures and bankruptcy. No to very low reserve requirements and debt to income ratios can in some cases exceed 50%. The seller no longer must pay the veteran’s non-allowable closing costs either as the lender now can provide a lender credit.
Experience Counts
Open your sphere of clients by adding VA financing to your marketing and you will be amazed what a difference it will make. Reach out to us and to gain access to the best lenders in the business.
This has been a guest blog post written by Kevin Budde President of Monarch Coast Financial. Assisting veterans with their financing since 1976. He can be reached at: 949-784-0397 or [email protected].
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