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Maximum Loan Amount What is VAs maximum loan amount? a. $144,000 b. $417,000 c. $325,000 d. None of the above a. $144,000 b. $417,000 c. $325,000 d.

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Presentation on theme: "Maximum Loan Amount What is VAs maximum loan amount? a. $144,000 b. $417,000 c. $325,000 d. None of the above a. $144,000 b. $417,000 c. $325,000 d."— Presentation transcript:

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2 Maximum Loan Amount

3 What is VAs maximum loan amount? a. $144,000 b. $417,000 c. $325,000 d. None of the above a. $144,000 b. $417,000 c. $325,000 d. None of the above VA guaranteed loans do not have a maximum dollar amount. However, there are some limitations to loan size… VA guaranteed loans do not have a maximum dollar amount. However, there are some limitations to loan size…

4 Calculating Maximum Purchase Loan VA Funding Fee Lesser of purchase price or reasonable value + + Up to $6,000 Energy Efficient Improvements + +

5 Calculating Maximum Construction Refinance Lesser of reasonable value or sum of outstanding balance of the loan plus allowable discounts Up to $6,000 Energy Efficient Improvements VA Funding Fee

6 Calculating Maximum Installment Land Sales Contract Lesser of reasonable value or sum of outstanding balance of the loan plus allowable discounts Up to $6,000 Energy Efficient Improvements VA Funding Fee

7 Calculating Maximum Loan assumed by veteran at an interest rate higher than the proposed refinance Lesser of reasonable value or sum of outstanding balance of the loan plus allowable discounts Up to $6,000 Energy Efficient Improvements VA Funding Fee

8 Calculating Maximum Interest Rate Reduction Refinance Loan (IRRRL) Existing VA loan balance + + Up to $6,000 Energy Efficient Improvements + + VA Funding Fee Allowable closing costs and up to 2% discount + +

9 Calculating Maximum Cash-Out Refinance Loan Up to 100% of the reasonable value Up to $6,000 Energy Efficient Improvements VA Funding Fee

10 REMINDER! VA does not have a maximum dollar amount for the VA-guaranteed loan. –However, the lender generally needs a 25% guaranty from VA in order to sell the loan on the secondary market. –If you are unsure if you have a marketable loan, speak to your companys post closing department or the investor. VA does not have a maximum dollar amount for the VA-guaranteed loan. –However, the lender generally needs a 25% guaranty from VA in order to sell the loan on the secondary market. –If you are unsure if you have a marketable loan, speak to your companys post closing department or the investor.

11 Maximum Guaranty

12 Effective December 10, 2004, VAs maximum guaranty for certain loans in excess of $144,000 is 25% of the Freddie Mac conforming loan limit.

13 Maximum Guaranty* Freddie MacLoan Limit (2007) VA Maximum Guaranty (25% of loan value) $417,000Continental US$104,250 $625,500 Alaska, Hawaii, Guam, US Virgin Islands $156,375 *See for higher cost county loan limits for 2009.www.homeloans.va.gov/new.htm

14 How does VAs guaranty work? *Generally, the lender needs a 25% guaranty in order to sell the loan on the secondary market. Basic entitlement: $36,000 $36,000 X 4 = $144,000 Additional entitlement*: $68,250 $36,000 + $68,250 = $104,250 $104,250 X 4 = $417,000

15 The maximum guaranty table is located in Chapter 3, section 4a of the VA Lenders HandbookVA Lenders Handbook The percentage amount of guaranty is based on the loan amount including the funding fee.* Notes: *If included in loan amount.

16 Remaining Entitlement *The lender is responsible for ensuring they have a marketable loan. *The lender is responsible for ensuring they have a marketable loan.

17 Base Entitlement Available Additional Entitlement Available* Total Entitlement Maximum Loan with no $$/Down $36,000 (Full entitlement) $68,250$104,250$417,000 $17,500$68,250$85,750$343,000 $8,500$68,250$76,750$307,000 $0$68,250 $273,000 Calculating Remaining Entitlement *Bonus entitlement is increased by 50% for loans in Alaska, Hawaii, Guam and the Virgin Islands.

18 Questions? Contact your nearest VA Regional Loan Center via telephone or .VA Regional Loan Center Contact your nearest VA Regional Loan Center via telephone or .VA Regional Loan Center

19 Reference: VA Lenders Handbook Chapter 3 Sections 3 and 4

20 Thank you for your interest in the VA Home Loan Program! We appreciate your support!


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