VA UPDATED Mortgage Guidelines For 2020 On VA Home Loans

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This ARTICLE On VA UPDATED Mortgage Guidelines For 2020 On VA Home Loans Was PUBLISHED On February 11th, 2020

VA UPDATED Mortgage Guidelines

Gustan Cho Associates are always bringing guideline changes to our readers’ attention.

  • Every calendar year we see some unique changes to loan programs such as loan limits changing
  • At the end of the third quarter of each calendar year, the Federal Housing Finance Administration (FHFA) analyzes data across the nation in regard to an average home price index (HPI)
  • The changes in the home price index annually adjust the loan limits for each county across the nation
  • In this blog, we will detail a few of the changes and how to apply for a mortgage without LENDER OVERLAYS with Gustan Cho Associates

In this article, we will cover and discuss the VA UPDATED Mortgage Guidelines For 2020 On VA Home Loans.

VA UPDATED Mortgage Guidelines On Maximum Loan Limits For 2020

VA UPDATED Mortgage Guidelines on the loan amount changes for the calendar year of 2020:

We have already written a few articles going over the conventional (conforming) loan limits and FHA loan limits changes for the calendar year of 2020, see the links below. In this blog, we will focus more on the changes coming to VA mortgages. The U.S. Department of Veteran Affairs recently released a bulletin outlining these changes. Let’s dive into more detail.

As part of a recent bulletin from the U.S. Department of Veteran Affairs, the BLUE WATER NAVY VIETNAM VETERANS ACT OF 2019 has removed the loan limits for VA mortgages starting January 1st, 2020. Just because there is no ceiling loan limit, does not mean you will qualify to borrow more than your current County loan limit.

VA UPDATED Mortgage Guidelines On Maximum Loan Limit Versus DTI

What are Mortgage Guidelines On Maximum Loan Limit Versus DTI

Qualifications must be met as far as debt to income in residual income is concerned.

  • In the past, VA mortgages have used Freddie Mac conforming loan limits, starting in 2020, veterans may be able to purchase a higher-priced home without a down payment
  • All indications look like the VA will only guarantee 25% of the loan amount
  • The details are still fuzzy, and lenders may still put loan limits on their VA mortgage loan limits
  • As more details are released, we will bring our readers up to date
  • This is still a huge breakthrough for our nation’s veterans
  • Many veterans live in parts of the nation such as California, Texas, and Colorado where home prices are high

This will allow the brave service members to enter into a mortgage without a down payment. As details are released, we will keep you updated.

Changes In VA Funding Fee

Higher funding fee starting in 2020:

  • Since the VA will now be guaranteeing more money based on higher loan amounts, they must be able to finance this operation
  • With the good comes the bad
  • The removal of VA loan limits comes an increase in the VA funding fee
  • As part of the Blue Water Navy Vietnam Veterans Act of 2019, a new funding fee has been established for the next two calendar years
  • A slight increase for first-time use, as well as subsequent use, will be put into effect starting January 1st, 2020
  • The increase in funding fee will provide the Department of Veteran Affairs with more funds to keep guaranteeing their mortgage loans
  • It is important to understand that the funding fee is not out of pocket and is financed through your mortgage payment

Many veterans are not happy with paying a funding fee however the funding fee is a better option than paying monthly mortgage insurance with other programs such as an FHA mortgage.

VA UPDATED Mortgage Guidelines On Purple Heart Veterans

What could be the guidelines for mortgages for Purple Heart veterans

Purple Heart Veterans:

Another addition to VA funding fee guidelines was added with the blue water Vietnam veterans Act of 2019.

  • This Edition immense the act by adding a funding fee waiver for all Purple Heart recipients
  • Some of our bravest men and women are purple heart recipients and are now not required to pay a VA funding fee
  • If you are a Purple Heart recipient, it should state this on your Certificate of Eligibility

If it does not, we can assist you in updating the Certificate of Eligibility Department at the VA.

Applying For A VA Loan With A Lender With No Overlays

Applying for a mortgage with Gustan Cho Associates is very easy. We do our best to make this as simple as the process is possible for our clients. When looking to apply for a mortgage, you will need some basic documentation. Below are the items you need to gather to get pre-approved:

  • Last 60 Days Bank Statements – to source down payment and/ or closing costs
  • Last 30 Days Pay Stubs
  • Last Two Years W2’S or 1099’s
  • Last Two Years Tax Returns (all pages)
  • Driver’s License or Government Issued Photo ID

Once you have gathered the documentation, please give Mike Gracz a call on 630-659-7644. You may also email mgracz@gustancho.com. At this point, you will be paired with a licensed loan officer in your state from Gustan Cho Associates Mortgage Group. Your loan officer will analyze your credit profile, income documentation, and asset documentation. With this information, you will either receive a pre-approval letter or a financial plan to qualify as soon as possible. It is important to understand that 75% of our clients have been turned down by other lenders due to lender overlays. We spend the time to make sure you and your family purchased the right house. Buying a house is a long-term investment so we want to make sure you buy the best house for you / your family.

We look forward to hearing from you with any mortgage-related questions. The team at Gustan Cho Associates are available seven days a week, even during the holiday season. You can call or text Mike Gracz on 630-659-7644 any of your mortgage questions. If you have been turned down in the past, we would love to hear from you. We do not have any lender overlays and we’ll come up with a customized financial plan if you do not qualify today.

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