As one of the major benefits given to military veterans, it’s important you are kept up to date on the latest changes to VA home loans in 2020. If you plan on purchasing a home in 2020 with the help of one, then keep reading to see how 2020 is changing the way VA home loans affect you, the qualifier.
2020 VA Loan Funding Fee Change
In June 2019, the Blue Water Navy Vietnam Veterans Act of 2019 was signed into law but won’t be active until January 2020. With it comes several changes for VA Funding Fees.
Temporary (2 year) change to the VA Funding Fee with an increase from 0.15 to 0.30% for Veterans and servicemembers.
VA Funding Fee will slightly decrease for National Guard and Reserve Members.
The Fee change will not impact Veterans with service-connected disabilities, some surviving spouses, and other potential borrowers.
Active Duty Service members who have earned a Purple Heart can have the fee waived if closing on their home while serving on active duty.
No VA Home Loan Limits in 2020
In 2019, a VA loan borrower who did not have a down payment was subject to receiving the guarantee price limit of $484,350 for a home loan. Now in 2020, to expand the benefits for more veterans, they are not capping the size of a loan a veteran can receive if they have no down payment. Thus, veterans can start scouting higher-value homes to live in.
Native American Veterans will benefit from this as well. The new law will remove the loan limit of $80,000 for a Native American Veterans using their entitlement for a direct loan to purchase or build a home on Federal trust land.
While these new changes for VA home loans are beneficiary, lenders will still be cautious. You still have to make the necessary amount of income to qualify. The doors may have opened for more veterans to pursue more homes, but that doesn’t mean that it’s easily attainable if you lack the sustainability and financial health to afford it. For veterans who can afford a higher mortgage, the loan process has now become a lot easier in 2020.
Future VA Home Loans
The waiting game of purchasing a home when the “time is right”, may be over now. You can now look forward to starting a fresh life in 2020. For new veteran homebuyers, this is an exciting time. With the restrictions being lessened in January, we can only look forward to what is to come for VA home loan borrowers. If you are curious about qualifications or need help getting started, give Devin Fahrner, a mortgage loan officer who specializes in VA Home Loans in Idaho, a call.