Veterans Home Loans Increasing In 2011

People looking for an opportunity buy a home in today's market are in for a long process. Banks have tightened up lending requirements and homes have lost their value. Current home owners whom are selling thier property for less than what they owe face a long approval process from the institutions that they owe money to.

Potential buyers are looking for ways and sources to supplement loans, assitst with closing costs and open doors to buying a home. The Veterans Administration Home Loans is an avenue that many people are heading down.

A recent study by VA Home Loan Centers has found that VA loans are on the rise. In 2009, VA Home Loans represented 9.5% of every home sale; in 2010 the VA home loan financing increased to 10.77% of all home sales. Furthermore, the study indicates that by 2011 people using the VA loan option could rise to 11.5% of all homes sold.

Market conditions, limited consumer resources, VA loan advantages and adjustments to bank lending regulations appear to be the reasons for this major increase. Banks took a hard look at lending procedures in 2009 and noticed that there was a crisis. People were starting to default on loans because of hard economic times. The banks suffered losses as a result of the defaults and an unraveling began which has only recently slowed.

Because of difficulties and increased expenses during the recession, many consumers have limited cash on hand. To add to this, new bank regulations have changed the way Americans buy houses.

The good news is that government loan products are now on the rise. In an effort to assist the economic recovery, the VA has made some adjustments to loan limits. When combined with institutional guideline adjustments, the end result is an increase in consumer confidence as it relates to the VA loan.

VA housing loan limits are to rise for 2011. Although limits vary state to state the increases are happening in most regions. The largest VA loan increase for 2011 is found California, New Jersey, New York and Utah. New York and New Jersey limits are to increase from $681,250 to $735,000 and Utah limits are to increase from $516,260 to $612,500. With more money that is available for people to borrow is it ever a wonder why the percentage for VA home loans is on the rise.

On the flip side there are some communities where the limits have fallen. Still in these communities the process to apply for the loan remains the same, and is still an option for most would be home owners.

Another reason for the increase is that people are realizing that VA home loans can be used to purchase short sale homes. Short sale homes are homes that are being sold for less than the mortgage. Banks are allowing this from time to time when they stand to recoup more money versus a foreclosure.

Buyers who use VA financing, find that more sellers are willing to pay for the buyers share of closing costs. VA loan options allow bankrupt people to get back into a home sooner than other loan programs. In order to get a VA loan with a bankruptcy, you must have Trustee approval and no late payments in 12 months before the application.

It is very clear that VA loans are on the rise. People are realizing that it is an easy option to help get them the home they want to live in. Others with tainted credit scores have an option to get back on their feet sooner than waiting seven years to do so.


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To apply for VA loan or for more info, visit VA HLC . Philip Georgiades is the CLS for San Diego VA Home Loan Centers.