VA county limits, similar to FHA county limits, refer to the maximum loan amounts that the Department of Veterans Affairs (VA) will guarantee or insure for mortgages in specific counties or areas. These limits are established by the VA and are based on the conforming loan limits set by the Federal Housing Finance Agency (FHFA).

• By guaranteeing loans up to the county limits, the VA enables eligible individuals to secure financing for homes that might otherwise be unaffordable without a down payment or private mortgage insurance.

• Housing prices can vary significantly across different counties and regions. By setting county limits, the VA takes into account the varying costs of housing in different areas, ensuring that eligible veterans can still use their VA loan benefits to purchase homes in higher-cost regions.

• The VA loan program is designed to help eligible veterans, active-duty service members, and surviving spouses become homeowners. By setting county limits, the VA ensures that veterans in higher-priced housing markets can still access affordable financing options through the program.

• The Department of Veteran’s Affairs guarantees 25% of the loan provided by approved lenders, which means that if a borrower defaults on a VA-guaranteed loan, the VA will reimburse the lender up to 25% of the outstanding loan balance.

• County limits help manage the risk associated with guaranteeing loans in areas with higher-priced homes.

• The VA county limits are often tied to the conforming loan limits set by the FHFA. This alignment ensures consistency and helps maintain a level playing field with other loan programs in the market.

• In the case of a VA loan, a veteran’s entitlement is a key part of the total consideration. For veterans with full VA loan entitlement, loan limits no longer exist as of January 2020. As such, qualified veterans can now purchase a home above the national loan limits for conventional FHA and USDA loans without the need for a down payment and most investors will finance up to $3 million without any type of down payment.

It’s important to note that VA county limits can change annually based on the FHFA’s conforming loan limit adjustments. These changes help the VA loan program adapt to market conditions and continue providing valuable homeownership opportunities for veterans across the country.