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Converting a VA Loan into a conventional Loan?

I currently have a VA loan in California and I don't have any more VA entitlement left as I've used it all up with the current loan. I will be pcsing within the next year. My sole purpose was to free up the Va loan because of the benefits it's brings. But I am not sure if that would be the best decision or if that would save me any money in doing that. by cuban8dudeca393 from , California. Mar 27th 2017 Reply


Laleh Hanks (laleh@americachoicemortgage.com)
#1082 ranked lender in California - 13 contributions

Hi, I first want to thank you for your service. I really appreciate your sacrifice. VA loans are my favorite. I would love to help you understand all your options. I would need more information to be sure I do not mislead you. www.AmericaChoiceMortgage.com My name is Laleh and I have been lending for 15 years. 11 years as a Navy wife and my brother served AF. I would consider myself an expert at this point. Are you absolutely certain you used all your eligibility? I ask because there are high balance loan limits and I have helped many use their VA more than once. Most prices in CA won't let you do that but there is a calculation to it. please contact me so I can give you advice that is accurate and specific to you. Laleh (at) AmericaChoiceMortgage.com

Mar 27th 2017
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William J Acres (William_Acres)
#2 ranked lender in Arizona - 7,797 contributions

If you sell your existing home prior to purchasing the new home, then you can use your VA benefits.. just coordinate a simultaneous closing on both properties.. If you refinance now, then all you would be doing is adding costs to your payoff.. If it's not necessary, then I wouldn't advise it.. If you had enough remaining entitlement to purchase 2 homes, the VA would allow it... but as you stated, you used up all your benefits on the CA home, so that's really not an option.. If you plan on keeping that CA home, then yes.. it's best to refinance it now into a conventional loan, which would free up your entitlement for the new VA home loan down the road.. We Love Our Veterans and understand the sacrifice,,, you're greatly appreciated.. With Gratitude, William J. Acres, Arizona/California NMLS #226347 480-287-5714. WilliamAcres.com

Mar 27th 2017
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Larry Gray (lgray_312_247)
#4 ranked lender in California - 1,127 contributions

Both comments thus far hopefully have provided good answers to your question. Obviously, if you feel it would be best to hold on to the home and rent it out while you seek to buy another home it may be wise to refinance into a conventional loan to free up your VA benefits for purchasing a new primary home. It is important to consult with a mortgage broker/banker in California and/or in the State you plan to purchase in. My difficulty in purchasing with a VA loan last time was the hot market in my area of California, otherwise it is a terrific loan that I provide for VA eligible borrowers whenever possible (rate is lower than on a conventional loan now) to buy with 0 to low money down. That may be necessary if you need to hold onto most of your cash reserves and are not going to sell your home.

Mar 29th 2017
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Larry Gray (lgray_312_247)
#4 ranked lender in California - 1,127 contributions

I mistakenly assumed you may yet have VA benefits you yet have not used though you have indicated you do not. Obviously, as per William's comment you may only have the option of holding onto the property with the loan as is and buying with a conventional loan with as little as 3% down payment. I should not have thought maybe you could refinance and use VA benefits if you truly have none left to use. If you choose to sell the property you also do not want to let someone assume the loan unless it is another veteran or active duty individual so that you will be able to reassume your V A loan benefits.

Mar 29th 2017
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