Last week, President Trump officially signed the Blue Water Navy Vietnam Veterans Act into law. The timing is just about perfect, right before the 4th of July! This new bill has been in the works for some time and it greatly impacts the benefits that veterans can receive. Some aspects of the bill are aimed specifically at helping Vietnam War vets while other programs help all veterans.

No More VA Loan Limits

From a mortgage standpoint, the biggest news coming from the Blue Water Navy Vietnam Veterans Act is that it eliminates the cap on VA loan amounts. Previously, veteran homebuyers could borrow up to $484,350 with no down payment. Now, people seeking VA loans can borrow above that amount in most U.S. counties (including San Diego County and all counties through Southern California).

VA loans are mortgages backed by the U.S. Department of Veterans Affairs and they provide great terms for veterans who qualify. They require much smaller down payments compared to traditional mortgage loans and some borrowers can even get a loan with no down payment whatsoever. Now, these no-down-payment loans don’t have a borrowing limit and that’s exciting news for many potential home buyers.

Important Details from the New Veterans Bill

Earlier drafts of the Blue Water Navy Vietnam Veterans Act did push for an increase in lending fees for VA loans. However, many trade groups like the National Association of Realtors (NAR) lobbied against these fee increases. Fees will go up a little as a result of the final bill that was signed into law, but not as much as they were originally proposing. Ultimately, veterans will benefit from these changes because they can borrow even more without a requisite down payment.

It is important to note that a down payment is still recommended. Whatever you can put down, the better your loan terms will be and the less you will ultimately owe in principal throughout the life of the loan. A healthy down payment and good credit score can help you secure a lower interest rate and cut down on any private mortgage insurance (PMI) payments that will also be required until you pay off a certain amount of principal.

Qualifying for a VA Loan

However, if you are a veteran or active in military service, you may be able to qualify for a VA loan with no down payment. VA loans are there to help our brave military men and women who might not otherwise have the means to afford a home purchase.

“As we aim to ensure our nation’s veterans have every possible opportunity to achieve the American Dream of homeownership, the National Association of Realtors has remained a strong supporter of the VA home loan guaranty program” says John Smaby, NAR President. “This vital tool encourages private lenders to offer favorable home loan terms to qualified veterans and provides a much-needed resource to those who have sacrificed so much for this country.”

To learn more about VA loan options and to start your VA loan application process, call Transparent Mortgage today at (619) 701-3906. If you already own a home and are looking to refinance, be sure and ask about the Interest Rate Reduction Refinance Loan (IRRRL) program also aimed at helping out veteran homeowners.

Beau Hodson

Beau Hodson

About the Author Since 2003, Beau has been a mortgage professional and is a leading mortgage broker and lender in San Diego. As Founder and Senior Mortgage Advisor at Transparent Mortgage, he is truly committed to serving the needs of his clients and raising industry standards for integrity and transparency.