Alameda Ca. What property types are available for financing in the Bay Area?
With VA mortgage loans, you are allowed to take out a loan on either the purchase of an existing home or for the construction of a new home.
However, VA mortgage loans are for primary residences only; you cannot purchase an investment property or second home with a VA loan as these property types are not eligible for VA financing.
A little known fact of a VA Loan is that you can purchase an owner-occupied 2-4 unit property and get 100% financing. It is possible to live in 1 unit and rent the others and get 100% financing! There is a slight catch to this, the VA does like to see landlord experience. If you do not have prior landlord experience (either as a property manager or owning rental units yourself) you can still purchase a 2-4 units property with 100% VA financing, but you would have to qualify without counting the rental income. It is possible to use a market vacancy to calculate rent to qualify. If you are looking at purchasing units with VA financing it is a good idea to get the “rent roll” and then contact us.
After you have found a home or decided to have a new one built, you will need to have it approved for a VA loan through a VA-approved appraiser.
A VA appraisal involves a thorough analysis of the home and property to determine what the current market of the home and property is. This appraisal is especially geared towards reporting any defects involving safety or security of the home.
Here is a list of things to consider when shopping for a new home:
- The appraiser needs to inspect both the inside and the outside of the house. If the house in question is being constructed, the appraiser still needs to analyze the property and construction site.
- The official appraisal report will contain a list of “observable repairs that need to be completed.”
- This report will also contain a list of “customer preference items to be installed.”
- A few small issues with the property won’t immediately disqualify it, but a lot of small issues or a few big issues may. Be aware of “Section 1” repairs on any termite report before you write the offer is possible. This will need to get fixed and the VA veteran has a very good chance of having the seller pay.
Our article The VA Loan Appraisal Process gives a fully detailed explanation of the process.
VA loan limits are also an important factor when it comes to taking out a loan. In most veteran loan scenarios, the VA guarantees up to 25% of the total amount of the loan up to the VA loan limit in your county – which, in much of the US, is $417,000.
To check what the VA county loan limits are for each county in the United States, you can visit the U.S. Department of Veterans Affairs at their loan limit website. For counties that are not listed on the website, the official VA loan limit is automatically set at $417,000.
Now, if the value of the home you want to purchase is greater than your county loan limit, don’t worry. You can get what is referred to as a “VA Jumbo Loan,” which will allow you to take out a VA loan on a home valued above the applicable county loan limit
VA Jumbo Loans, the VA mandates that the borrower pay 25% of the difference between the cost of the loan and the VA county loan limit. At the same time, the VA would still guarantee 25% of the county loan limit.
For calculations of down payments and rates for your home purchase give us a call for accurate pricing. We have helped VA buyers in Alameda, Oakland, San Francisco and the entire Bay Area.
If you or someone you know is looking to explore their options with VA financing feel free to contact us, we are here to help you and we love serving those who serve.
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