Around 85 percent of military families live off base, which tends to be a surprise to the civilian public. This means that the majority of us are renting and buying our homes, temporarily. There’s always been ongoing confusion on the VA home loan benefit for many military families but with the passage of the Blue Water Navy Vietnam Veterans Act – it’s so crystal clear.
The biggest question that was always asked was how many times you could utilize the VA home loan benefit. This is a fair question considering active duty military families are moving every two to three years. Before the law’s passage, you could probably use the benefit twice but it would be cutting it close. This was mainly because the original limit was $500,000. Although it seems like a good chunk, it wasn’t – especially when you factored in higher cost of living areas. But with the law’s passing – the borrowing limits went out the window. Good riddance.
So, what does it look like now for loan borrowers who want to use their benefit a second time? It’s pretty easy, actually. Although there is no limit to borrowing (as long as the amount you are borrowing doesn’t exceed the value) there are county limits. This really refers to if you still have an outstanding VA home loan and will mean that you can only borrow up to whatever that county limit is.
If you are attempting to run two VA Home Loans at a time, it’s possible but its limited. There will be a calculator involved to determine how much you are eligible to borrow under the limits with the member or veteran having to come out of pocket or find other means to complete the loan requirements. You can find more about county limits here.
The good news is that most of us tend to sell our homes and then buy a new one near the new duty station. When you do this? Your full VA Home Loan benefit is restored. There you have it, you absolutely can use your VA Home Loan a second time. It’s a little tricky if you are keeping the property (but can be done) and it’s basically a breeze if you’ve sold or paid off your first VA Home Loan.
When you utilize your VA Home Loan benefit after the first initial time, the VA funding fee does go up. Currently it sits at 2.3 percent for first time users and goes to 3.6 percent for every benefit use after that first time. Those who have service related disabilities and are the recipients of Purple Hearts do not have to pay the funding fee at all, thanks to the passage of the Blue Water Navy Vietnam Veterans Act. There are some other ways this fee is waived, to see a full list you can visit the VA website to learn more.
The VA Home Loan benefit isn’t a one-time thing. You can actually have two running at the same time and can continue to use the benefit over and over as long as the eligibility requirements are met. The VA has been guaranteeing loans for its veterans and service members since 1944 and the ability to borrow safely and securely has just gotten easier and easier as the years have passed. So, what are you waiting for?
Shameless plug: Caliber Home Loans has been given the honor of being a Military Friendly ® brand four years in a row. When looking for a lender, they will be there to help you walk through the process with their stellar customer service and military lending experience.
If you are a servicemember on active duty, prior to seeking a refinance for your existing mortgage loan, please consult with your legal advisor regarding the loss of any benefits you are entitled to under the Servicemembers Civil Relief Act or applicable state law.
Military Spouse & Blogger
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