Starting on January 1, 2020, Veterans and active military members will have more borrowing power thanks to the Blue Water Navy Vietnam Veterans Act of 2019. The new law eliminates VA loan limits in 2020.
Signed in June of this year, the new law eliminates VA loan limits in 2020. This change means more veterans can buy a home with no down payment, including homes that are for sale above $1,000,000. But, some VA lenders may still block veterans from a no down payment loan for a home above $1,000,000. Veterans need to find a lender that will allow veterans to use the full benefit of the Blue Water Navy Vietnam Veterans Act of 2019.
What Is the VA Loan Limit?
The VA loan limit is defined as the maximum amount guaranteed by the Department of Veteran Affairs without borrowers having to make a down payment. That limit increased in 2020 so that veterans can buy homes over $1,000,000 with no money down. But many lenders will still require a down payment when the purchase price of the home is above the lenders loan limit.
It’s important to understand that VA lenders can impose their own loan limits on top of the VA loan amount guidelines.
No More VA loan limits in 2020
The elimination of VA loan limits doesn’t mean a Veteran has the ability to borrow unlimited amounts without a down payment because you will still need sufficient income to qualify for the loan amount. But, of bigger concern is that some lenders will continue imposing their own limitations on VA loan amounts. You will need to find a lender like HomePromise that closes VA loans at amounts higher than most other VA lenders.
In short, if you qualify for a VA loan this year, you will be able to borrow more.