Is There Really a VA Loan Limit? (Jumbo Loan)

3/08/2018

If you’re a military veteran who is looking to purchase a home, then you’ve likely considered a VA home loan. These affordable loans are a great option, with no down payment or mortgage insurance required. However, many veterans are not familiar with the VA home loan or the requirements surrounding it.

Case in point: many veterans are unaware of the limits placed on VA home loans. Here in Texas, the VA loan limit is capped at $453,100, which is the most that can be borrowed at one time with no down payment. This is sometimes referred to a VA Jumbo Loan. This is the standard VA loan limit for fiscal year 2018 but in most cases there are loans that can be offered over the standard limit to qualified Texas veterans. Typically, these veterans will have a credit score of 580 or higher. And unlike the standard VA loan, these increased loans do require a down payment.

Interested in learning more about the VA loan limit? Keep reading below to find out how these requirements may affect your family's future.


graphic about VA loan limit and VA jumbo loan

The VA Jumbo Loan

This VA loan variation is called a “VA Jumbo Loan,” and the down payment that is needed is based on the difference in price between the home price and the standard loan limit. That would be the $453,100 maximum VA loan. The VA Jumbo Loan down payment will typically be equal to 25% of the difference.

Example

An example of this loan in practice would be if the home price was $473,100, which is $20,000 over the standard limit. The borrower would need to put 25% of that $20,000 as a down payment, which equals $5,000. That is less than 1.13% of the total purchase price of the home, which means this loan is still an attractive option for veterans.

If you compare this to a typical down payment on a conventional loan, which is often a minimum of 5%, it is a much better deal. It is also a better alternative than the Federal Housing Administration’s (FHA) home loan, which has a 3.5% down payment. The VA Jumbo Loan is also more likely to have better interest rates than both a conventional loan and a FHA loan.


If you would like to speak with a loan professional about the prequalification process, please call us at 866-704-2826 or click on the button below and complete our quick-and-easy online form and a member of our staff will contact you right away to discuss your options.

We welcome the opportunity to assist you.