Higher Loan Limits Proposed for VA Loan Program
The House of Representatives Veterans’ Affairs Committee chairman, Rep. Bob Filner, a Democrat from California, called the current VA loan program “irrelevant” for a number a reasons including the loan caps, high fees and strict underwriting and appraisal requirements all of which discourage homebuyers, real estate and mortgage brokers and sellers from using the program.
That’s why he and other members of his committee are working on legislation that would raise loan rates and possibly cut through some of that red tape in order to encourage use of the program.
Filner’s plan has yet to be completed but he says the maximum loan limit in his plan would be $620,000, up from the current $417,000. He is also considering a provision that would prevent lenders from foreclosing on the home of anyone on active duty.
Rep. Steve Buyer, an Indiana Republican, and Mike Michaud, a Democrat out of Maine, introduced their bill last week would raise the maximum loan amount the Department of Veterans Affairs can guarantee. While their proposed limit is not as high as Filner’s uncompleted plan, theirs is still worth paying attention to. Buyer and Michaud’s bill would raise the maximum from $417,000 to $521,250.
Buyer was the former committee chairman and cites the low maximum loan limit as the primary reason the veterans are straying away from the program. In high cost areas of the country the $417,000 cap is much to low and forces service members and veterans from using the program.
Buyer says, “Rising housing costs are keeping many veterans out of the market. And those who are able to purchase the American Dream are paying significantly higher closing costs.”
Buyer and Michaud hope to increase some of the guaranty of the program, making refinancing using the VA loan program a viable option. Right now it isn’t really an option. “With affordable housing so scarce in many areas of the nation,” says Michaud, “the increased guaranty and closing cost assistance should be very advantageous to both our nation’s veterans and home builders.”
chet the vet
December 22nd, 2007 at 2:26 amI hope they really do something with the funding fee at least. when I did a va refi I paid 3.3% in a funding fee it is really high. it would be awesome if they reduced that.
Billy Brown
December 25th, 2007 at 8:57 amI would like a listing of Mortgage companies who work with Disabled Veterans for home loans.
chet the vet
December 28th, 2007 at 1:57 pmHi Billy you can go to http://www.vareficenter.com and they help disabled vets and they waive the funding fee
Erin Enderle
January 10th, 2008 at 1:25 pmBilly,
I work for Mortgage Research Center & specialize in VA home loans. Give me a call: 1.800.814.1103, x306.
I’ll be more than happy to help you with your VA home loan questions!
Michael George
January 28th, 2008 at 3:46 pmAny veteran (active, disabled, retired, etc.) in Southern California should call Barbara George at Superior Mortgage, Inc., 800-649-2600. Barbara has over 14 years experience doing VA loans in San Diego County and surrounding areas.
VA loan activity has increased substantially in the last several months due to the decrease in housing prices coupled with the increase in VA loan limits. However, we find that many real estate agents are inexperienced in VA transactions simply because for so many years, in a high-cost area such as this, the VA loan limit was not sufficient for a vet to buy even the average priced home. The result is that even now, most R.E. agents will avoid doing a VA even though they have a vet who is well qualified.
If the agent you are using tells you that a VA loan is not a good idea, or is too cumbersome or difficult to close, you really should call Barbara George or at least seek out someone who can give you the answers you need. There is no good reason for a qualifying vet to take out any other type of loan. The number again, 800-649-2600.
Scott McLear
April 13th, 2008 at 1:37 pmDoes anyone know if I am able to secure a VA mortgage loan for a purchase of a house in New York state? I tried filling out the request and New York is not listed under the “State you plan to purchase the home”.
Any info would be great, thanks.
va purchase loan
May 6th, 2008 at 1:15 pmYes the VA will guaratee a loan in the state of New York.