Tag: zero down VA loans

Can you have more than one VA Loan?

If you have a Veterans Affairs (VA) Loan on your first home and are thinking about buying a second property, you can get more than one VA Loan without having to sell or refinance your current home. This is called VA Loan second-tier entitlement. The higher tier entitlement kicks in for purchases over $144,000 per VA guidelines.

The federal government has provided veterans and military personnel with the VA Loan so they can come back to the United States and purchase a home with no down payment. That’s much better than having to come up with a 20% down payment for a conventional loan on a second home, so you should take advantage. If you are considering getting two VA Loans, here’s how it works:

VA Loans Second Tier Entitlement

Michigan has a county loan limit of $453,100 for VA Loans. The VA provides borrowers with a 25% guaranty on their loan, which, in Michigan’s case, would be a maximum of $113,275. If you already have a VA Loan on your first house, the guaranty provided to you would be subtracted from the maximum amount.

VA Entitlement Calculation Example

Let’s say you bought a $200,000 primary home with a VA Loan and you want to buy a second home in Michigan with a VA Loan. Let’s figure out the math on this.

$424,100 X 25% = $113,275 maximum guaranty

$200,000 X 25% = $50,000 guaranty and down payment required

$113,275 – $50,000 = $63,275 maximum guaranty allowed on second home

$63,275 x 4 = $253,100 maximum price of second house

Maximum VA Loan Amount Calculation

Basically, if you bought a $200,000 home in the state of Michigan using a VA Loan, the VA would have guaranteed $50,000 toward your down payment. If you want to buy a second home in Michigan with a VA Loan, you can buy one that is a maximum of $253,100 with no down payment. If your second home costs more than that, you will have to add some money for the down payment.

Let’s say the second home you’re considering is $300,000. The 25% entitlement on that house would be $75,000, putting you $11,725 above the $63,275 maximum guaranty. That means you would have to add a down payment of $11,725 to be able to purchase the second home for $300,000 with a VA Loan.

Related: Try our VA Mortgage Calculator to estimate mortgage payments for your VA Mortgage.

Benefits to getting two VA Loans

If you are relocating or just want to buy a new home, a second VA loan may be the best solution. Here are the benefits of getting your second VA Loan versus Conventional financing:

  • Do not need to sell your current home that has a VA Loan
  • Do not need to refinance your VA Loan into a Conventional Mortgage to qualify
  • You may be able to rent your current home and offset the mortgage with rental income
  • You will save on home sales fees
  • You will save on mortgage refinance costs
  • You may still qualify for Zero Down Financing

Buying a Second Home with a VA Loan

VA Loans are typically more lenient than other types of loans. If your first home was foreclosed, you can still get a VA Loan on your second home. Riverbank Finance can help you find out how much of the VA’s 25% entitlement you still have left to use.

If you are planning on buying a second home using VA financing to use as your primary residence we would be glad to assist you. You may be eligible for a second VA loan for your purchase and not be required to sell your current home. For more information, call Riverbank Finance at 800-555-2098 to set up an appointment with one of our loan officers.

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VA Loans Just Got Better

 

For eligible servicemembers, veterans, and surviving spouses, the existing VA home loan program just got better! The Department of Veterans Affairs (VA) has introduced a new policy regarding how student loan debt affects mortgage eligibility.

Related: VA Loans for Military Veterans

VA loosens Guidelines for Student Loans

The new policy makes it easier for VA eligible borrowers to obtain a purchase or refinance loan, by changing the way student loan monthly payments are calculated. Prior to this change, 1% of the total student loan debt had to be counted toward the borrower’s debt-to-income (DTI) ratio each month, regardless of actual monthly payment structure or deferment. Now, however, the payment will be calculated based on 5% of the total student loan debt, divided by 12 months. Clear as mud, right?

Lets do some math!

For example, lets say John has $65,000 in student loan debt. Formerly, his monthly student loan payment would have been $65,000 * 1% (.01) = $650. Now, his payment will be $65,000 * 5% (.05) / 12 = $271.

What if John is on an income-based repayment structure, and only pays $250 per month? The new policy also allows a statement from John’s student loan servicer to be provided, allowing the calculated payment to reflect the actual loan terms.

What if John’s student loans are in deferment? If his repayment is scheduled to begin within 12 months from the estimated closing date, we must use the 5% / 12 months rule. If not, however, the payment can be omitted altogether if written evidence can be provided that repayment will be deferred at least another 12 months from the closing date.

By changing the way student loan payments are calculated, more VA eligible borrowers will qualify, and for a larger amount. Check out our VA Mortgage Calculator to estimate your monthly payment on a desired home purchase.

What is a VA home loan?

VA home loans are originated by private lenders, banks, and mortgage companies, but the VA guarantees a portion of the loan, allowing us to offer you more favorable terms. VA purchase loans help you buy a home with a low interest rate, without requiring a down payment or private mortgage insurance (PMI). There are also special VA loan programs for Cashout and Streamline Refinances.

Who is eligible for a VA home loan?

Active servicemembers, veterans, and surviving spouses are eligible for VA home loan programs, with a valid certificate of eligibility (COE). Length of service or service commitment, duty status and character of service determine each veteran’s eligibility for specific benefits. All VA borrowers are still subject to the minimum credit score requirement of 580 and sufficient income levels to cover expected monthly obligations. For more specific information on eligibility and requirements, visit the VA benefits website.

For More Information Visit the VA Student Loan Announcement.

Get More Information

To apply for a VA Mortgage or Refinance call Riverbank Finance today at 1-800-555-2098.

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VA Home Loans for Military Veterans | Free Appraisal

Veterans Day - Free Appraisal OfferAbout Veterans Day

As the United States continues fighting overseas, the population of military veterans continues to increase. According to the most recent Census information there are over 21 million veterans that have served our country. The growing population of veterans struggle to receive proper healthcare and are faced with repeated VA hospital related scandals and deficiencies. There are nearly 4 million veterans with service related disabilities that return to the United States and are in great need of a helping hand from those around them.

Please remember the meaning of Veterans Day and together, let’s honor those who have served our country.

VA Home Loan | Free Appraisal Offer

Here at Riverbank Finance, we take pride in offering zero down VA loans to our military veterans. As with most of our loan options, we offer VA loans with no lender fees and have zero cost loan options. From today through the end of November, the owners of Riverbank Finance will personally pay for the appraisal cost for new VA-eligible home buyers that receive financing through our company.

Disabled Veterans can Waive the VA Funding Fee

For military veterans with a disability rating of at least 10%, the Veterans Administration will waive the VA funding fee.  Additionally surviving spouses of veterans who died in service or from a service-connected disability are also eligible to have the VA funding fee waived.

Michigan Property Tax Exemption

Veterans that have served our country and have disability rating of 100% are eligible to have their Michigan property taxes waived for their primary residence located in the state of Michigan. We would love to help our disabled veterans complete the required paperwork to have their property taxes waived as part of our home buying process.

We look forward to helping you buy a home with no down payment using your VA benefits. Call a VA loan officer today at 1-800-555-2098 to start your home purchase application or request information below:

Request Information Now!

Disclaimer: Appraisal program available only to new clients that are approved for VA financing. Riverbank Finance LLC reserves the right to discontinue this program without notice. Not all will qualify. No purchase necessary. Call 1-800-555-2098 to request your VA certificate of eligibility through the Veterans Administration.