Qualify for a VA Home Loan
A veteran with full entitlement available may borrow up to the 2011 VA loan limit shown below and VA 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 "typical" maximum VA loan is guaranteed for $36,000 for loans below $144,000. That means the VA promises the lender $36K should the buyer default on the VA mortgage. For loans above $144,000, the VA will guaranty up to 25% based on county limits listed at the VA official site.
The reason for this varying figure is simple; not all housing markets are equal. Some are more expensive than others, and to set one VA loan standard for all housing markets would penalize some buyers and benefit others. A rate that varies depending on housing market conditions in a given area is fair and flexible.
According to the VA, "...a veteran with full entitlement available may borrow up to the 2011 VA limit shown below and VA 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. Lenders should check their own investor requirements regarding guaranty amounts and down payments."
To help borrowers, lenders and real estate agents, the Department of Veterans Affairs publishes an annual list of county loan limits for VA Mortgages. The VA list consists of loan limits for all high-cost counties broken down by state; it's a directory of unique high cost markets from Alaska to Wyoming.
The VA list does not include all counties--any markets not specifically listed in the document have a 2011 limit set at $417,000. If you don't see your county in the VA master list, it's safe to assume the county limit is $417,000.
-- Find your county's VA Limits for 2011.Two-thirds of Americans agree that now is a good time to buy a home, according to recent surveys. However, thinking about moving ahead with a purchase of our own can make us concerned over whether we're doing the right thing. In general, the best time to buy is when you're ready to move, and have found an affordable property which you like. The primary purpose of owning real estate is to enhance your daily life.
Purchasing a home is a very specific transaction. Just as someone who needs to haul big loads should buy a truck rather than a sports car, it's essential to find a house and neighborhood which fit your needs. Long-time owners know that when they're ready to move again, their built-up home equity will make it easier for them to pursue their dreams. But if you've been writing monthly checks to a landlord for years, you'll have nothing to show for it in the future.
Many of us view negotiating as a game where one person "wins" and the other "losses." Yet experienced negotiators understand that the best results occur when both sides are satisfied. Someone who is intent on driving a tough bargain may irritate the other party, and then it's harder to reach an agreement. However, discovering what terms the other side prefers can make everyone happy about working together.
You may find when buying a home that the sellers have specific preferences. Perhaps they want to stay in their home until a certain date. If that doesn't interfere with your plans, you can agree to that. But whenever you grant a concession, you should ask for something comparable in return. Sellers often are more willing to grant your requests if you're not asking for a price reduction.
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Home purchasers are finding it's important to not be distracted by negative reports they read or hear about. Today's real estate market is challenging, but also contains opportunity. Don't let someone else's complaints about the housing market keep you from completing a smart purchase this year. Remember that something you hear on a broadcast or read in a national publication may not reflect the conditions in a neighborhood you're considering moving to. It's more helpful to focus on specific properties you're interested in, rather than on the market as a whole.
You'll discover that we also focus on your unique home buying goals when going over your financing options. Count on us to show you positive ways you can afford the home you want. For instance, you may have heard that mortgage rates have gone up in recent weeks. Economists say this reflects both concern about growing government deficits and increased strength in America's recovery. Yet be assured that rates remain at comfortably-low levels. In 2010 the average rate on 30-year, fixed-rate home loans reached its lowest point in 55 years, says mortgage investment firm Freddie Mac.
Lenders look at credit scores as a tool for predicting how well prospective borrowers will pay their debts in the future. Fortunately, there are things you can do to better your score, and improve your chances of gaining funds at a lower interest rate. Simply paying bills on time is the first key to a better credit rating. Lenders generally are pleased to provide money to consumers who are able to stick to a budget, and make bill payment a priority. But even being a day late can mean a credit bureau will report that you've missed a payment. Set up a system to ensure you're able to consistently meet those obligations, and you'll be well on your way to an excellent credit rating.
It's tempting to close a credit card once the balance is paid off. Yet credit experts say doing so actually can lower your credit score. Lenders see it as a positive if you have available credit that you're not using. So if you have several charge cards, make sure none of them is maxed out. And once you've paid off an account, it's better not to cancel that card. If you do want to cancel a card, select one you haven't had for long, and which has a low credit limit. It's important to periodically review your credit report to check for errors. Do this a few months before you plan to buy a home; if there are issues, it can take several weeks for the credit bureau to correct your report. We'll also go over your report with you, and suggest ways you can raise your score.
More economic indicators are pointing towards steady growth in the U.S. One measure of manufacturing in the Midwest jumped at year-end to its highest point since the late 1980's. Both increased consumer and business spending are cited by economists as positive factors for the coming months. Home purchase activity also has been rising, notes the National Association of Realtors (NAR). For 2011 NAR forecasts that home sales will go up eight percent. "All the indicator trends are pointing to a gradual housing recovery," says NAR Chief Economist Lawrence Yun.
Consumer confidence and spending could rise this year, since Americans will benefit from a drop in Social Security withholding taxes. Workers will see their paychecks grow as a result. Some homebuyers and owners also will gain from an extension of the tax deduction for private mortgage insurance premiums. A portion of the 2010 tax credits on energy-saving home improvements have been extended into this year, as well. Continued low mortgage rates and great house prices are making a home purchase affordable for families now. Get in touch with us soon to find out how you can enjoy 2011 in your own special home.
Repeatedly trying to obtain a better price can cause sellers to feel you don't value their home. It may be easier to get them to agree to pay part of your closing costs, however. Don't hesitate to ask them to leave a unique chandelier or other feature which works well in that house. A unique piece which they purchased for that property may not be something they want to move. At the least, the sellers will appreciate that you like their taste in furnishings! Someone moving a long distance also may prefer to let you have some of the appliances, rather than paying to haul them.
Although house prices are attractive now, real estate professionals note that you shouldn't go into the buying process expecting a fabulous deal. Sellers typically won't give away desirable homes. Having an attitude that you'll purchase only if you locate an incredible bargain means you'll likely be disappointed. Your results will improve dramatically once you start looking for sensible deals, rather than outright steals. Begin by talking with us about different mortgage solutions. We'll work to ensure your payments fit into your household budget.
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