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What You Need To Know
- ✔ Loan limits will be lifted in 2020
- ✔ The VA backs 25% of your home loan
- ✔ Until 2020, if you exceed the loan limit, you will most likely have to make a down payment
Top VA Lenders
A while back we told you about the Blue Water Navy Vietnam Veterans Act. When President Trump signed the law saying Navy Veterans who served on the seas around Vietnam would get benefits they deserve, the VA home loan limit was also lifted.
Currently, the VA backs 25% of a qualifying veteran’s VA home loan, and with that comes loan limits. While your entitlements reset when you sell or pay off your home, you can still only buy a home for less than or equal to the county’s loan limit where you’ll be purchasing a home.
Yes, you can exceed this loan limit, but then you’ll be required to make a down payment. With the loan limit being lifted you can now purchase a $2 Mil home if you wanted. Of course, the VA still only backs 25%, and a lender doesn’t have to issue the loan.
In any case, there’s no longer a down payment required for any VA home loan purchased house. And that means you can buy that $500,000 house without making a down payment, no matter which county you live in.
However, this will not go into effect until 2020. So, if you’re purchasing a house during the summer of 2019, you’ll still be stuck with loan limits and a down payment if you choose to buy a house exceeding the limit for the county the house is located in.