Do You Live in a VA Jumbo Loan County?
For typical VA home loans, the loan limit is based in part on something known as the county loan limit. That limit is normally $417 thousand, except in areas the VA has designated as high-cost counties. These areas have higher VA loan limits because the housing market there is more expensive.
On the subject of VA loan maximums, the Department of Veterans Affairs official site declares, “The maximum guaranty amount (available for loans over $144,000) is 25 percent of the 2011 VA limit” which again, is typically $417,000 except in high-cost counties.
The VA adds, “Therefore, a veteran with full entitlement available may borrow up to the 2011 VA limit” and the Department of Veterans Affairs “will guarantee 25 percent of the loan amount. If a veteran has previously used entitlement that has not been restored, the maximum guaranty amount available to that veteran must be reduced accordingly.”
A VA Jumbo Loan is any VA loan that exceeds $417,000. VA Jumbo Loans may be issued in high-cost counties as well as those with typical VA loan maximums. Technically speaking, the VA does not designate high-cost counties as “VA Jumbo Loan counties” but unofficially it’s easy to see why some would view a place such as San Francisco County in Phoenix as a “Jumbo Loan County” as the VA maximum loan there is set at $1 million for fiscal year 2011.
According to VA rules, any VA Jumbo loan that exceeds $417,000 may require a down payment of 25% in certain cases, but only when the loan amount exceeds the county limit. However, there may be a difference between what the VA allows in terms of a down payment and the lender’s requirements for loans of this size.
The VA official site addresses this issue saying, “Lenders should check their own investor requirements regarding guaranty amounts and downpayments. Questions about VA loans in a particular county may be directed to the VA Regional Loan Center listed for that county.”
If you aren’t sure whether you live in a county with higher VA loan limits than $417,000, check the VA list of high-cost counties here: http://www.benefits.va.gov/homeloans/docs/2011_county_loan_limits.pdf