VA home loans allow military borrowers to purchase a house with no money down. Depending on your level of entitlement and whether you’ve taken out a VA loan before, you may be subject to conforming loan limits. These vary by county and are updated each year. Below, we’ve discussed what to expect for VA loan limits in 2024.
Understanding VA Loan Limits
To understand VA loan limits, you need to be familiar with the basic concepts of VA entitlement. VA entitlement refers to the benefit available to veterans, active duty service members, reservists, and certain surviving spouses for obtaining a VA home loan. This entitlement is part of the VA home loan program, administered by the U.S. Department of Veterans Affairs.
VA entitlement is essentially a financial guaranty from the government that offers security to the lender against loss if the borrower fails to repay the loan. This guaranty enables lenders to provide more favorable financing options to qualified borrowers, including no down payment, competitive interest rates, and limited closing costs.
Full Vs. Remaining Entitlement
It’s essential for veterans and service members to understand their entitlement status, as it affects their borrowing power and the potential need for a down payment on a new VA loan. Those with full entitlement have more flexibility and potentially greater purchasing power, while those with remaining entitlement may face some limitations based on how much entitlement they have left and local loan limits.
- Full VA Entitlement: This means the veteran or service member has not used any of their VA loan entitlement, or they have fully restored their entitlement after paying off a previous VA loan in full and selling the property. With full VA entitlement, there are no loan limits on the amount a veteran can borrow with a VA loan, aside from what a lender is willing to lend, without needing to make a down payment.
- Remaining VA Entitlement: This occurs when a veteran or service member has used a portion of their VA loan entitlement and still has some entitlement left. The remaining entitlement can be used to purchase another home with a VA loan, but there are some limitations to consider. Calculating how much a veteran can borrow with remaining entitlement can be complex since it depends on county limits for conforming loans and how much entitlement has been used previously.
Conforming Loan Limits for 2024
You can find a list of conforming loan limits for U.S. counties on the FHA’s website. Keep in mind that the figures listed here are not guaranteed. You’ll also need to meet the requirements stipulated by your lender. Your financial health is an important factor in determining how much you can borrow.
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