My wife and I bought a home 2.5 years ago and currently have 518k principal left on our loan. We've been thinking of wanting to move back to our home state for a number of reasons and I wanted to crunch some numbers to see if it'd make financial sense to try and keep this home to rent out since we've got a very nice interest rate locked in.
I've read some stuff about jumbo VA loans and entitlement but have no idea how to calculate that or what we'd qualify for. I'm basically just interested in if it'd be possible for us to use another VA loan if we were to purchase another home in a HCOL area. Could anyone point me towards some useful reading or mind working out some math for me? How much entitlement do we have left? Is there a max that the VA would approve for us? What's a jumbo VA loan?
Our annual gross income is around 300k and our only debt is the mortgage and 52k remaining on a car loan. We've got about 130k liquid rn for a down payment.
Posted by goblue2k16
1 Comment
Quick way to find out your remaining VA loan entitlement and how much of a downpayment you’ll need to make:
Look up the Conforming Loan limit for the county you want to buy in (https://singlefamily.fanniemae.com/media/document/xlsx/loan-limit-look-table). Then subtract from that the original loan amount on the home you currently own. This is the amount of entitlement you have remaining. — For the new home you wish to purchase, take that purchase price and subtract from that your remaining entitlement; this is the portion of the new loan that will NOT be backed by the VA; you will need to put down 25% of that amount.
Example (insert your exact numbers and zip code):
Original (not current balance) loan of home you currently own: $500,000
New property located in zip code 23456 (Virginia Beach VA); Conforming Loan Limit in 23456: $766,550
$766,550 – $500,000 = $266,550 (this is your remaining entitlement)
New home purchase price: $500,000
$500,000 – $266,550 = $243,550 (this is what is not covered by the VA)
25% of $243,550 = $60,887 (this is your down payment)