This is because most lenders require that your entitlement, down payment, or a combination of both covers at least 25% of your total loan amount. You may need to make a down payment if you’re using remaining entitlement and your loan amount is over $144,000. The VA-backed home loan limit refers to the amount we’ll guarantee (the maximum amount we’ll pay to your lender if you default on your loan). We don’t limit how much you can borrow to finance a home. Is the “limit” the amount I can borrow or the amount VA guarantees? You had a foreclosure on a previous VA loan and didn’t repay us in full.You had a deed in lieu of foreclosure on a previous VA loan (this means you transferred your home’s title to the bank that holds your mortgage to avoid foreclosure), or.You had a compromise claim (or short sale) on a previous VA loan and didn’t repay us in full, or.You refinanced your VA loan into a non-VA loan and still own the home, or.You paid a previous VA loan in full and still own the home, or.
You have an active VA loan you’re still paying back, or.You may have remaining entitlement if any of these are true: You can use your remaining entitlement-either on its own or together with a down payment-to take out another VA home loan. This means that if you default on your loan, we’ll pay your lender up to 25% of the county loan limit minus the amount of your entitlement you’ve already used. With remaining entitlement, your VA home loan limit is based on the county loan limit where you live. If you have remaining entitlement, you do have a home loan limit You won’t need to use these terms when applying for a loan. We use these terms when we communicate with lenders about VA-backed loans over $144,000. Note: You may have heard the terms additional entitlement, bonus entitlement, or tier 2 entitlement. You’ve used your home loan benefit, but had a foreclosure or compromise claim (also called a short sale) and repaid us in full.You’ve paid a previous VA loan in full and sold the property (in this case, you’d have your full entitlement restored), or.You’ve never used your home loan benefit, or.You have full entitlement if you meet any of these requirements.
This means you won’t have to pay a down payment, and we guarantee to your lender that if you default on a loan that’s over $144,000, we’ll pay them up to 25% of the loan amount. If you have full entitlement, you don’t have a home loan limitĮligible Veterans, service members, and survivors with full entitlement no longer have limits on loans over $144,000.
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