Each year, the Department of Veterans Affairs (VA) releases a revised list of loan limits covered under its Loan Guaranty program. The Guaranty limits are based off of Federal Housing Authority estimates of median home values on a county-by county basis. Veterans who are eligible for full entitlement may borrow up to 100 percent (no down payment required) of a county's maximum limit with 25 percent of the loan guaranteed by the VA Loan Guaranty program.
VA loans fall into two categories: regular conforming VA Loans to $417,000, and Jumbo VA loans which support counties with higher maximum Guaranty limits. Newly adjusted Guaranty limits have been issued for all San Francisco Bay Area counties, with the exception of Solano County where the maximum guaranteed limit remains $417,000. Here are the 2013 limits for all San Francisco Bay Area counties:
2013 Guaranty Limit 2012 Guaranty Limit
Alameda $987,500 $1,000,000
Contra Costa $987,500 $1,000,000
Marin $987,500 $1,000,000
Napa $521,250 $ 500,000
San Francisco $987,500 $1,000,000
San Mateo $987,500 $1,000,000
Santa Clara $823,750 $ 831,250
Solano $417,000 $ 417,000
Sonoma $448,750 $ 456,250
Special features of VA loans include:
100 percent financing up to maximum Guaranty limit.
No private mortgage insurance
VA loans are assumable by qualified borrowers
Closing costs can be paid by the seller.
Not all lenders offer Jumbo VA loans and even those who underwrite credit above the $417,000 mark may still fall short of a given county's maximum limit. When seeking a VA loan above $417,000, one should verify that their lender has the ability to extend credit in the anticipated amount needed to support their eventual purchase.
The Appraisal process is also a bit more demanding with VA loans and full termite and pest reports are required on all properties. Another potential concern when operating within a tight close of escrow period is the relative scarcity of VA appraisers. There are generally few available -as is the case for the Bay Area -and some lenders have better access than others to VA appraisers and to faster delivery turn times. So it can be beneficial to work with a lender who does a good volume of VA loans in the area where you are considering buying a home.
Veterans interested in getting a VA loan should first get their Certificate of Eligibility to establish what their entitlement benefit is. The Certificate of Eligibility can generally be secured by one's lender, or by checking on the Department of Veterans Affairs website at the following webpage link: VA Eligibility
Eligibility should be verified with the VA though, generally speaking, VA loans are offered to those in the following categories:
Have served a minimum of 181 days during peacetime (Active Duty)
Served at least 90 days during war time (Active Duty)
Currently on Active Duty with 90 days of continuous service
Served 6 years in the National Guard or Reserves.
A surviving spouse of a service member who was killed in the line of duty