New mortgage limits on the amount the Department of Veterans Affairs will guaranty have been released. Dozens of counties saw an increase.
While the department doesn’t actually limit the size of a home loan a lender can make to a veteran, it does have a maximum amount it will guarantee.
The amount of the VA mortgage guarantee is 25 percent of the mortgage amount
in cases where the borrower doesn’t make a down payment.
However, since many VA loans wind up in Ginnie Mae and other securitization pools, the loans typically don’t exceed four times the guaranty amount.
The new limits were discussed in Circular 26-15-31 published by VA on Thursday.
The maximum guaranty amount by VA is based on conforming loan limits published by the Federal Housing Finance Agency.
Next year’s conforming loan limit remained at $417,000, putting the maximum VA guaranty at $104,250.
But the limit can go as high as $625,500 in counties deemed to be high cost, putting the guaranty amount at $156,375 in those areas.
For 2016, 39 counties moved into the high-cost category.
VA financing can be utilized to purchase two- to four-unit properties, but the guaranty amount will be limited to the single-family limit.
On Interest Rate Reduction Refinancing Loans, the maximum guaranty is not limited by county.
In cases where the county loan limit has decreased, VA said it will honor the previous guaranty limit on purchase financing as long as a loan application was signed by the
borrower and lender prior to Jan. 1, 2016, and provided to VA with a time stamp verifying the date. The loan must be closed by the end of 2016.
Information about VA loan limits is online at
FHFA’s list of increased limits by county is at:
www.mortgagedaily.com/ConformingLimit112515Form.asp
A full listing of FHFA limits for all U.S. counties is at:
www.fhfa.gov/DataTools/Downloads/Documents/Conforming-Loan-Limits/FullCountyLoanLimitList2016_HERA-BASED_FINAL.pdf
