jumbo VA loans

VA Jumbo Loan Facts

May 4, 2011

VA Jumbo Loan Facts

In our last post we discussed the VA Jumbo Loan, which is defined as any VA home loan that exceeds $417,000 for VA loans with no money down. The Department of Veterans Affairs has identified 17 states where the county VA loan limit is higher than the typical $417 thousand limit in other states.

In these areas veterans are not expected to settle for what might be considered inferior housing just because the market is more expensive. The VA Jumbo Loan is a way for qualified borrowers to purchase suitable homes in markets where the loan limit can be much higher–above $1 million in some cases.

What does a borrower need to know about VA Jumbo Loans?

For starters, it helps to compare the Jumbo loan limit and terms to typical VA loan limits. For example, in counties where the maximum VA loan limit is typical ($417,000) a qualified borrower has the option of a no-money down loan for amounts up to the VA limit. The borrower has the option to pay or finance the VA loan funding fee at this level.

For any loan amount above the $417,000 limit in these counties, the VA loan applicant must pay 25% down on any amount above the limit. That means 25% of the actual amount above the limit, NOT the entire loan. Borrowers are also expected to pay the funding fee in cash for loans above the county limit.

Now let’s look at counties where the VA Jumbo loan would apply–any of the 17 states where the VA county limit exceeds $417,000:

A qualified borrower has the option for a no-money-down VA loan on the maximum amount for that county limit as determined by the VA. As with a typical VA home loan, the borrower pays 25% down only on the amount greater than the county limit and the borrower must pay the funding fee in cash on any loan higher than the VA county limit and $1,000,000.

For any VA Jumbo Loan above $650 thousand there is a minimum credit score requirement of 640, and borrowers cannot use a VA Jumbo loan to purchased manufactured housing. As stated above, VA loan funding fees cannot be financed for any loan above $417,000. The VA Jumbo Loan is not available as a variable rate mortgage.

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  1. Karl O Pierce

    100% disabled Vietnam vet, house on 4.69 acres with guest house on intracoastal waterway just appraised@1,500,000 Present mortgage 200,000 15 year fixed at 6.25%. Monthly payment 6,300.00/ mo. 300,000 home equity. Want to combine into one loan at today's rates to reduce monthly payment. Age 71 and partially retired. Can you help?

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