California’s 2015 VA Maximum Loan Guaranty Limits were just announced by the Department of Veteran Affairs. The new loan limits reduce our Veterans loan purchasing power by as much as $424,500 in 11 of California’s high cost counties. See VA Circular 26-14-39 for details.
What media outlets are not reporting is that the VA county loan limit actually INCREASED in 12 other counties throughout California.
The VA Has Loan Limits in Each County?
Yes, but technically, the VA doesn’t cap how much a Veteran can borrow or how much a bank can lend. The VA loan limit determines how much of a down payment the Veteran needs when borrowing over the county loan limit.
For example: If the county VA loan limit is $417,000, and the Veteran is buying a $500,000 home, they’ll need to come in with 25% of the difference between $417,000 and $500,000. So the VA loan down payment requirement would be $20,750 if the Veterean has full entitlement.
Why Did the VA Reduce the Loan limits?
it wasn’t done to purposely harm veteran eligible home buyers or the real estate market. The VA automatically defaulted to the Federal Housing Finance Administration’s conforming loan limits because Public Law 110-389 expires Dec. 31, 2014. The FHFA Conforming loan limits range from $417,000 to $625,500 in high-cost-areas of California.
This change is helping VA borrowers in 12 other counties secure larger laon amounts (see below).
Good News if You Want to Refinance:
Interest Rate Reduction Refinance Loans (IRRRL VA Streamline) will NOT be subject to the new 2015 VA county loan limits. The VA will continue to guarantee 25% of the principal balance on an IRRRL, regardless of whether the loan exceeds the limit for the particular county. This does not apply to VA cash out refinance.
2015 VA County Loan Limits in California
Red = Counties where the VA loan limit was REDUCED
Blue = Counties where the VA loan limit INCREASED
|California County||2015 VA Loan Limit (1 unit)|
|Contra Costa County||$625,500|
|Del Norte County||$417,000|
|El Dorado County||$474,950|
|Los Angeles County||$625,500|
|San Benito County||$625,500|
|San Bernardino County||$417,000|
|San Diego County||$562,350|
|San Francisco County||$625,500|
|San Joaquin County||$417,000|
|San Luis Obispo County||$561,200|
|San Mateo County||$625,500|
|Santa Barbara County||$603,750|
|Santa Clara County||$625,500|
|Santa Cruz County||$625,500|