2022 Hawaii VA Loan Guide: FAQ’s & Tips
In our work as realtors in Hawaii, VA loan questions are common. We recommend downloading the VA Buyer’s Guide along with our FAQ’s and Tips below. Don’t let this process be overwhelming, our Military Relocation Professional certified Realtor team is here to serve!
FAQ’s
What is the VA loan?
The VA loan is a benefit for active duty, nation guard, certain eligible spouses, and veterans that allows them to enjoy home ownership with no down payment, competitive interest rates, and fewer closing costs.
What is the VA loan limit in Hawaii?
Good news! First-time loan users and those with fully-restored entitlements have no limit on their VA loan. Yep, you read that right. As of 2020, the VA loan limit has been lifted. That means you could buy a one-million dollar home, with no down payment. Of course, you still need to be able to pay the mortgage and fees. We’ll get into that below. Learn more about VA Home Loan Limits from U.S. Department of Veteran Affairs.
What are funding fees on a VA loan?
The VA loan does charge a funding fee which can be rolled into the loan. The fees differ for first time home buyers and subsequent users. Exemptions for those that do not have to pay funding fee include: veterans receiving 10% or more disability rating, Purple Heart recipients, unmarried surviving spouses of Veterans who died in active service or from a service connected disability, and a few other exemptions. It’s best to speak with a VA loan officer about VA funding fees and exemptions, or refer to Department of Veterans Affairs.
Below is the current VA funding fee amounts.
Should I choose a local or national lender?
There are some great national lenders, but we HIGHLY recommend using a local lender. Local lenders are more accessible, especially here in Hawaii where we have a 2-3 hour time difference from the west coast and a 5-6 hour time difference from the east coast. This may seem like a small hurdle, but small hurdles can become big hills when you’re trying to close on a home in time! Need help finding a local lender? Feel free to reach out if you have any questions or if you want us to connect you to a local lender!
Can I use the VA home loan more than once?
Yes! If you sell your home or pay off your mortgage, you may be eligible for a VA loan. Just keep in mind, if you’ve already used the loan once, you’ll be subject to a slightly higher funding fee.
Can I have more than one VA loan at a time? Second entitlement
The answer to this question is tricky, but ultimately, yes. There are some caveats. You can qualify for second entitlement if you’ve paid off the first or if you have a remaining balance on your available entitlement.
For example, the county limit in Hawaii is $970,800. Let’s say you use $350,000 to buy a home on the mainland; you’ll have $620,800 to use on a second property (see reasons why you’d do this below) no money down. However, if you bought the home for $700,000, you could still use the remaining to buy a different property, but you’ll have to put 25% down of the difference — between the remaining entitlement and the higher purchase price.
However, the VA loan is intended for active duty military and veterans to live in the homes they buy using the VA loan. So no, you can’t have a mansion in Florida and a beach house in Lanikai. But, if you’re looking to downsize or get a larger home and you have money left on your entitlement — you can take out a second loan to make that purchase before selling your current residence. It is best to speak with a loan officer for your situation, let us connect you!
Am I Eligible?
This is an important question. The VA loan is an amazing benefit, but not everyone qualifies for it. For eligibility you must have a good credit score, sufficient income, and have a valid Certificate of Eligibility (COE).
For active duty military, you’ll have to complete 90 consecutive days of active duty service in order to establish eligibility.
Oh, and as we mentioned earlier, this home needs to be for your own personal occupancy. These loans aren’t for vacation homes or rentals. Here’s more information about eligibility.
It’s also important to note that after you’ve closed on a home, you’ll need to move in within 60 days. There are some exceptions (for example, for deployed service members), so be upfront about your timeline.