VA Loan Limits 2020

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Troy Reichert

Troy Reichert

Troy Reichert is the owner of Reichert Mortgage LLC. With over 20 years of serving the United States Airforce, Troy wants to continue to give back to the community by helping give people their best chance at securing a home.

As of January 1st, 2020, the federally-established VA home loan limit has officially been repealed! This policy was put into motion when President Trump signed an executive order to remove regulatory barriers to affordable housing on June 25th, 2019. What this means for veterans is that they can now borrow beyond the conforming loan limit that previously inhibited them from purchasing the home they qualified for. VA loan limits will now be based on how well an applicant matches their particular lender’s credit requirements, ultimately allowing hundreds of thousands of veterans access to affordable housing across the nation and in Colorado as well. 

Here at The Reichert Mortgage Team, we are specialists in VA Home Loans, helping many veterans in El Paso County to buy or refinance their homes with notable savings via our Pikes Peak Heroes program. With the new VA loan limit being repealed, it will make buying a home just beyond your financial cap just that much easier. 

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What is a VA Loan Limit?

The VA loan limit is the maximum amount the VA office will guarantee in loans to your lender. While many VA loan borrowers think they are receiving loans directly from the Veteran’s Affairs Office. However, the VA simply backs your lender in the worst case you default on your loans. One of the added benefits of VA loans is you are able to qualify for homes that may not have qualified for otherwise.

VA Loan Limit 2019

Every year, the Federal Housing Administration changes the rules for VA loans in order to reflect the changing housing market. Over the years, VA loan limits have expanded to become more competitive for veterans to buy a primary home. Especially when the housing market skyrockets, these VA loan limits also spike so that veterans are able to have a better chance at obtaining decent housing. 

In 2019, the VA loan limits increased to the following amount in various counties in Colorado including El Paso:

One Unit: $484,350

Two Units: $620,200

Three Units: $749,650

Four Units: $931,600

These numbers are called the maximum conforming loan limit, or VA loan limits. For more information on how the VA loans work, consult our VA Loan FAQ page for more in-depth answers. Our mortgage glossary also contains many professional jargons that may be useful to you as well.

VA Loan Limits Eliminated in 2020

As of the new year, the federally-established VA home loan limit has officially been repealed. However, this does not mean that veterans now have unlimited borrowing power. You will still have to meet the lender’s credit requirements, which include sufficient income, balanced debt-to-income ratio, and a positive credit score.

As an industry-standard, only the best mortgage lenders will help veterans with this crucial process of determining your maximum borrowing amount. Here at The Reichert Mortgage Team, we specialize in VA loans and even offer credit counseling if you are considering taking a loan and require financial advice on the best path forward. 

The maximum conforming loan limit was eliminated for several reasons. First, the Department of Veteran Affairs now has the funding to back loans that exceed the maximum conforming loan limit. Second, this change was primarily made to help veterans seeking jumbo loans, that is, loans that exceed the conforming loan limit by an amount as small as $1, in higher-cost markets. In these particular cases, VA loan limits will no longer be a barrier.  

One thing to be aware of is that loan limits will still apply to veterans with active VA loans already. This means those who have defaulted on their loans or those with only partial entitlement. If this matches you, the new VA 2020 loan limit is as follows in Colorado per unit: 

One Unit: $575,000 

Two unit: $736,100 

Three Unit: $889,800

Four Units: $1,105,800 

These numbers reflect a $13,800 increase from 2019 VA loan limits.  

Apply For a VA Home Loan Today! | The Reichert Mortgage Team

Applying for a VA home loan is oftentimes complicated. That’s why working with a qualified broker that understands your needs is so important! Here at The Reichert Mortgage Team, we work side-by-side veterans to ensure the process of homeownership is seamless. From obtaining your VA home loan certificate of eligibility to refinancing your home, we got you covered. If you would like to apply for a VA loan, especially in light of these historic changes, contact us today! We would be glad to serve you. 

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