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VA Loans Offer Attractive Financing Terms

May 29th, 2011 · No Comments

 The Veteran’s Administration has modernized the current VA loan programs available to qualified veteran borrowers. These loans are very competitive and can offer an affordable financing alternative to prospective home buyers and people who want to refinance their existing mortgage.  Additionally, the current maximum VA loan limit is $1,000,000 which can be a great alternative to an expensive non-conforming jumbo loan (above $417,000) in high cost real estate markets like California and the San Francisco Bay Area.

Here are some of the terms and conditions for current VA loan programs: 

  • 100% loan to value (LTV) up to $417,000
  • Over $417,000 – down payment is 25% of the difference between $417,000 to $1,000,000
  • 580 minimum required credit score
  • Veteran borrowers need a DD214 (Notice of Discharge)
  • Seller allowed to pay up to 4% of the purchase price toward the Buyer’s closing costs plus 1% loan origination fee
  • 2/1 loan interest rate buy-downs available
  • All recommended section 1 structural pest control repairs, all recommended further inspections of inaccessible areas and all recommended section 2 repairs which may lead to infestation must be completed by the Seller
  • A structural pest control certification must be obtained prior to close of escrow
  • 45 day close of escrow

 Other significant benefits include loans over $417,000 will be priced at interest rates as good as conforming loan interest rates; down payment on a $1,000,000 loan will be only $145,750 or 14.57% of the purchase price; no private mortgage insurance required (PMI).  

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