Sprint Funding is the partner you need for housing loans. We have the lowest VA mortgage rates, and we offer multiple options like VA loans. A VA loan is a type of mortgage loan obtainable by means of a program spearheaded by the United States’ Department of Veteran Affairs.
The VA department establishes the necessary standards and terms of the mortgage loans, but they are not the ones who will deliver the money involved.
Instead, banks and mortgage companies finance these VA loans. They are available to active and veteran service personnel, as well as their beneficiaries or families.
At Sprint Funding, we can help you learn more about VA loans.
We can also help you secure the funding you need to own the home you want.
With over 15 years in the business, we can provide you with the guidance and tools you need to secure loans.
How VA Mortgage Loan Works
VA loans aim to help our active service personnel, veterans, widows, and widowers in terms of acquiring homes.
The person simply has to present a certificate of eligibility from the Department of Veteran Affairs to the lender while applying for a loan.
Sometimes, these private lenders have their own set of requirements that must be fulfilled by the applicant, but they are not much of a hassle as opposed to other types of loans.
VA loans were first proposed as part of the Servicemen’s Readjustment Act of 1944 but did not achieve popularity and widespread attention until recently.
During the first four months of 2019, about eight percent (8%) of house acquisitions were done with the help of a VA mortgage loan.
To be able to apply and get accepted into this loan program, the people in question have to fulfill the VA department’s set of service requirements.
We can help you with any inquiries you may have with VA loans, offering financial assistance for your homes.
VA Loan Requirements
Applicants are eligible if they fulfill any of three classifications:
The applicant is an active duty service member, or a veteran who was honorably discharged (no recorded offenses).
They must have had 90 successive days of active duty if a war is going on, or 181 days of active duty if it is a period or harmony.
The applicant has done over six years of active service for the National Guard or the Selected Reserve.
The applicant is the spouse of a service member who was killed while in active service or duty.
If an applicant is qualified, they must show lenders the Certificate of Eligibility that they acquired from the VA department.
A certificate may be requested through the Department of Veteran Affairs’ website. There are also options of acquiring a certificate through mail or even through the lenders themselves.
Most VA loans can get approved in about 40 to 50 business days, provided that the borrower fulfills all requirements asked by the department and lender.
The Benefits of a VA Loan
There are many advantages to having a VA loan.
For instance, VA loans do not require a down payment unless they are specifically asked by the private lender.
Since there are a multitude of lenders from banks to mortgage companies, an applicant can simply look for another entity to provide the loan if they do not wish to pay a down payment.
In cases where the home that the applicant wants to purchase is way over the time-honored property value, down payments are required.
VA loans also do not have a private mortgage insurance requirement. These private mortgage insurance fees are what the applicant has to pay if they decide to borrow from a commercial lender.
The insurance costs are usually advertised as being small (0.5 to 1%), but in reality, they can amass up to thousands in cash.
VA loans avoid these additional fees since they are not even required.
Of course, getting a mortgage is in itself a loan, so it is not free of charge.
Closing costs
All mortgage loans have what is called a closing cost, which are fees for the professionals handling the transactions and services that make the deals a reality.
These closing costs usually range from 2 to 5% of the property’s indicated purchase price. Like mortgage insurance, these can add up and reach thousands of dollars.
That’s why it is important for people to pay attention to these closing costs.
It is a good thing then that VA loans have limited closing costs. Some loan providers even pay these closing costs by themselves!
Furthermore, there is no limit to the amount of money that can be borrowed on a VA loan.
It is important, however, to pay attention to the liabilities incurred because there is a limit to that. In 2019, the Department of Veteran Affairs ensured that VA loans can cover up to 25% of the costs of a home loan.
There is also no minimum credit score required for a VA home loan.
A person’s credit score is a number assigned to a holder by banks or financial entities. This credit score is used to tell if a person has a high level of risk attached to them when they borrow money.
The usual credit scores fall between 300 and 850. Lenders of VA loans might still favor applicants who have a credit score of 620 above, just for good measure.
Having no credit score would be ideal as well because that means that the applicant has no debts incurred.
That means some lenders may be unsure to take in an applicant’s request if they have no previous transaction history regarding finances.
If you are confused, that’s natural.
VA loans, and home loans in general, can be a lot to deal with.
Sprint Funding is also a company fully committed to serving its clients, providing not just financial assistance but also guidance and understanding.
We value our relationships with clients.
How much are VA loan rates, and What are Its Disadvantages?
Depending on the product, interest rates can be as low as 2.74%, with the highest rates falling at about 3.46% as of August 2020.
The annual percentage rates fall between 2.87% and 4.04%.
It is important to seek out assistance from the VA agency, in order for the applicant to know which product is recommended for their financial situation.
There are still drawbacks to a VA loan, which is normal for any type of borrowing.
For example, since there is no down payment, that means you might end up owing more money.
Your monthly payments might also inflate since the funding fees are already included in the loan themselves.
People who are careless about which homes they purchase might also be prone to high interest since there is little limit to the type of housing they can place a loan for.
People can tend to take in more loans than they can pay off since the prospects of a VA loan are promising.
No loans, low-interest rates, and no minimum credit score are all perks, but a person has to be careful not to be blinded by them.
The lack of limits leads some people to place a loan for homes that are worth a lot of money. That’s why it is important for people to always seek assistance when applying for VA loans.
At the end of the day, whether a house is easier to obtain through a VA loan or not is up to the applicant.
One must really weigh in all of their options to come up with a viable decision. Still, it is worth noting that VA loans have a lot of benefits.
They are flexible, dependable, and help is available should the client need it.
Is There a Limit on How Much You Can Borrow With a VA Loan?
For many potential homeowners, these loans may be the best option due to the low loan limits and unique features they offer. However, there is an upper limit on how much you can borrow with a VA loan.
VA Home Loan Limits
The VA home loan limit is the maximum amount of money a veteran can borrow with a VA loan. The limit is set by the Department of Veterans Affairs (VA) and is based on the county in which you are buying or refinancing your home.
For 2021, the VA loan limit for most counties across the U.S. is $510,400. However, some areas have higher limits. For example, in high-cost areas like San Francisco and Los Angeles, the VA loan limit is $822,375.
In addition to the loan limit, there are other factors that can affect how much you can borrow with a VA loan. These include your credit score, debt-to-income ratio, and other financial qualifications.
If You Have Full Entitlement, You Don’t Have a Home Loan Limit
Having full entitlement to your home loan essentially gives you the highest level of borrowing power available for the type of loan program you’re applying for. This is because lenders consider multiple factors when determining the amount of money they will be able to lend you and with full entitlement, you’re more likely to get approved for a larger sum.
When it comes to understanding what counts as having full entitlement, there are several different criteria lenders look at.
Your income, credit score, debt-to-income ratio, and length of employment can all affect your eligibility for full entitlement and ultimately determine the amount you will be able to borrow for a home loan.
If You Have Remaining Entitlement, You Do Have a Home Loan Limit
Another key factor influencing just how big of a home loan borrowers fall into – regardless of their short-term ability to pay it back or not – is something called remaining entitlement. This amount varies depending upon factors such as whether they previously served over 190 days or more during wartime service periods following Sept 16th, 1940.
The same applies if they served at least 181 days between September 7th, 1980, and October 16th, 1981. However, there could also be additional reduced amounts based on particular regional criteria set forth by various government institutions, so it’s important to double-check specific eligibility guidelines here too.
Is the “Limit” the Amount I Can Borrow or the Amount VA Guarantees?
The “limit” is the amount VA guarantees. This means that the loan amount will not exceed the limit and becomes a backstop that allows lenders to approve veterans for larger loans.
VA does not establish loan or liability limits, but protective measures are in place like guaranty limits, which serve to protect Veterans from excessive debt.
How Does My County Loan Limit Affect Me?
Your county loan limit affects your home-buying budget. Loan limits are determined by the Federal Housing Finance Agency (FHFA) each year and apply to mortgages that conform to Fannie Mae or Freddie Mac—which means that certain loans will have different loan limits depending on your area.
Your county loan limit sets the maximum amount you can borrow towards a mortgage and therefore can be used as a guide for understanding how much house you can afford in your region.
Why Does My Coe Say, “This Veteran’s Basic Entitlement Is $0”?
A Certificate of Eligibility (COE) should say “This Veteran’s basic entitlement is $0” if the veteran has already used their eligibility for a VA loan.
The maximum entitlement is $36,000 (unless it was higher due to borrower-specific events). If this amount has already been used, then any subsequent VA loans will show an entitlement of zero.
What Are the VA Home Loan Limits by Year and County?
The VA home loan limits for 2023 are the same as they were in 2020. The maximum guaranty amount for loans up to $424,100 is 25 percent of the 2021 VA loan limit. For loans between $424,100 and $1,094,625, the maximum guaranty amount is 25 percent of the loan amount.
The VA home loan limits by county can be found on the Department of Veterans Affairs website. The VA also provides a county loan limit calculator to help you determine the maximum amount you can borrow in your area.
2023 VA Home Loan Limits
The Department of Veterans Affairs sets loan guarantee limits for cash-out and purchase refinancing loans every year.
For 2023, the VA has set loan limit maximums as follows:
Single Family Home/Townhome: $822,375;
Duplex: $1,053,000;
Triplex: $1,272,750;
Fourplex: $1,581,750.
The total loan guarantee amount available to a veteran in 2023 can not exceed the greater of these values or 25% of the VA county loan limit.
Limits on VA Loans
In conclusion, there is a limit on how much you can borrow with a VA loan. The maximum guaranty amount for loans up to $424,100 is 25 percent of the 2021 VA loan limit. For loans between $424,100 and $1,094,625, the maximum guaranty amount is 25 percent of the loan amount.
Additionally, your county loan limit sets the maximum amount you can borrow towards a mortgage and therefore can be used as a guide for understanding how much house you can afford in your region.
Call us today to Get Started
Sprint Funding can help you get VA loan rates fast and hassle-free. We have a tried-and-tested loan specialist team that can help you get the homes you always wanted.
The applicant is an active duty service member, or a veteran who was honorably discharged (no recorded offenses).
