Paramount Bank is making it easier and more fiscally sound for veterans and active service duty members to get mortgages.
In these uncertain times, people are focused on how they can take care of themselves, their families, and ideally, their communities. Eventually, however, the coronavirus pandemic will end, and we will all resume our new normal way of life. But if you’re a veteran looking to buy a home, you might not want to wait.
For one thing, interest rates are quite low right now. Plus, if your dream is to buy a home, there are certain changes happening that will help to make this particular dream a reality. Specifically, there has been a change to the law governing mortgages guaranteed by the Department of Veterans Affairs that makes it easier for veterans to buy a house.
Earlier this year, in response to the growing cost of single-family homes and condos in the U.S., some changes to the federal Blue Water Navy Vietnam Veterans Act of 2019 took effect. Perhaps most significant is that qualifying veterans using VA loans no longer have a price cap on a zero-down payment home loan. In the past, zero-down payment loans were capped at the same level as conforming loans.
Chris Birk, a director of education, said in a recent article from the Miami Herald, that before when a veteran applied for a zero-down payment loan for a home that exceeded the cap, they were required to make a down payment covering 25 percent of the difference between the loan limit and the sales price.
“The price cap in 2019 for how much you could borrow was $484,350, so if [a qualifying veteran] wanted to buy a $584,000 home, they had to make a $25,000 down payment,” Birk said. “While that was still an incredible deal, there were veterans who were getting priced out.”
Today however, that same veteran could finance the entire $584,000, with no down payment necessary. As an extreme example, recently I personally took an application for a veteran on a $4 million purchase, where the customer qualified for a 100% LTV, 30 year fixed at a sub 3% interest rate! I’m overly excited to see this loan closed, as I’m confident it will be the best terms on a “Super Jumbo” loan that I’ve ever seen.
Private mortgage lenders provide VA loans based on their mortgage-lending guidelines, the size of the loan, and the creditworthiness of the borrowers.
At Paramount Bank, we fully embrace our VA loan customers and have expanded our guidelines to take care of as many of their needs as possible.
We take the time to fully understand our active duty and Veteran customers’ unique needs, and are actively rolling out our SALUTE program to honor their sacrifices on our behalf. Not only will we continue to waive our origination fees, guarantee ultra-competitive pricing, and the widest possible guidelines, we will make affinity depository products with special financial benefits and superior terms available to those qualified. Paramount Bank will also donate on behalf of the veteran or active duty service member to the eligible Veteran Service Organization of their choosing on each VA loan we close.
The world is a bit chaotic right now because of the COVID-19 pandemic. Many people are hunkering down, keeping their heads low and focusing on family, health and safety. That’s certainly not a bad strategy, but there are definite pockets of clarity and opportunity for people — like veterans — who want to take advantage of market changes to position themselves well for our eventual recovery.
Thanks for reading!