"VA guarantees for loans up to $1 million or more are still possible in parts of Colorado and Massachusetts, but no longer in California as the five counties that had million-dollar limits in 2011 have fallen short this year."
iFreedom Direct, a national VA specialty lender licensed in most states, will begin offering VA loans with newly announced 2013 loan limits starting January 1 of the New Year. VA Loan Limits are subject to change annually based on the FHFA house price index. The Q3 report indicates home prices rose 1.1% from last quarter, and home prices appreciated 4.04% from the same time last year.
Based on this data, veterans can expect the conforming VA loan limit to remain at $417,000 for most U.S. counties. Certain high-cost counties often have higher limits.
In general, the high-cost limits are similar to those of the latter half of 2012 after legislative changes restored the more generous calculation method of prior years. The adjustment in the way limits are derived provides qualified veterans in certain high-cost military communities, like Prince William, Virginia for example, the potential to buy homes priced in pace with local real estate markets. The VA is committed to using this restored method through 2014.
In general, 2013 VA loan limits will see only slight or no changes from last year.
For instance, VA loan limits in Alaska will remain at $625,500. However, limits in almost all high-cost counties in California, New Jersey and New York are down slightly. Hawaii, Guam, and U.S. Virgin Islands will remain the same for the most part with the exception of Honolulu and St. John which have very slight loan limit changes from last year. Other states, which show slight changes up or down, include Colorado, Massachusetts, Maryland, Utah, Virginia, Washington, West Virginia and Wyoming. Interestingly, all counties in Utah and West Virginia are up, indicating house price increases there. New to the list of higher limit counties this year is Mono, California with a loan limit of $437,500. Off the high-cost list for 2013 are Blaine, Idaho, Bristol, Massachusetts, all of Rhode Island and Lancaster, Virginia. Loan limits is these counties dropped to $417,000.
VA guarantees for loans up to $1 million or more are still possible in parts of Colorado and Massachusetts, but no longer in California as the five counties that had million-dollar limits in 2011 have fallen short this year. If a loan limit decreases in 2013 for any county, the VA will guarantee the higher 2012 limit as long as there is proof of a pre-approval and a sales contract or a Uniform Residential Loan Application (URLA) executed before the New Year.
Each year the VA publishes a new list of VA loan limits.
The list contains only the names of counties with limits higher than $417,000. The list can vary from year to year as real estate markets fluctuate. Over the past several years, home price indices have been reporting year-over-year decreases. However, this year he FHFA's report shows an increase every quarter so far, and this may be an indication that the housing market is recovering.
iFreedom Direct VA Purchase Loan Manager, Tim Lewis, says, "We observe changes in the housing market very closely. Annual VA loan limits typically follow market fluctuations directly." Lewis goes on to say, "Many current homeowners who have been underwater in their mortgages would like to see their values go up."
The "limit" discussed isn't a limit per se on how much a qualified veteran can borrower using the VA home loan program, rather, VA loan limits show the maximum amount for which the government will provide its guarantee. Loans over the limit will likely require a down payment to secure the overage.
iFreedom Direct is a leading VA-approved lender providing VA-guaranteed loans with little to no money down, including no down payment, up to the conforming loan limit of $417,000. The loan professionals at iFreedom Direct assist eligible borrowers with VA loan products including purchase loans, streamline refinance and cash-out refinance loans. To learn more about VA loan limits in your area visit www.directvaloans.com
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