How to use a VA Loan instead of a Jumbo Loan

How to use a VA Loan instead of a Jumbo Loan:  As home prices continue to rise, I’m seeing a lot of my clients find challenges in their loan amounts.  That is, in San Diego county the Conforming Loan Limits are 546,250.  Beyond that you are looking at Jumbo Loans.  What I’ve found is that many of my clients have VA eligibility, but simply never used it.  This is likely due to VA Loans historically being less competitive and harder to use.  Well that’s no longer the case, and if you have VA Loan Eligibility, it might be time to rethink your strategy.

Let’s look at an example.  I recently helped some clients that wanted to refinance.  Their existing loan is 675k.  That would put them into Jumbo territory.  In this case they would have needed 25% equity, a higher credit score, a higher rate, and a bunch of $ in the bank.  By asking the right questions I found out that they had a VA eligibility that they had never used.  “We just never needed it, as we always had a down payment”.

In this case we were able to refi them out of their existing conventional loan, despite having only 10% equity in the property.  This would have been impossible to do with a Jumbo loan.  In addition, their interest rate was about .625% better with the VA loan.  They also had some credit issues, which VA is less sensitive about.

The lesson here is that if you have VA eligibility, you may have an opportunity to get a better loan than you already have.  This is true whether you have a VA loan now or not.  This is also a great trick for purchases.

If you’d like a free analysis of how a VA loan can benefit you, simply click here to email me.  I’ll send you some samples of how you can save money.

Jeremy Beck
Mortgage Planner
VA Wrangler