The VA home loan program and CalVet program are two of the few 100% financing options available to Orange County, California home buyers. Only a few years ago there were all types of 100% financing programs available to nearly anyone who wanted to buy a home, but even with the tightening of lender guidelines, the VA and CalVet programs remain. But what is the difference between these two options available to California Veterans? And which is better?
The biggest difference between the standard VA loan program and the CalVet program is the way in which money is lent. The California Department of Veterans Affairs offers the CalVet program. The CalVet program uses bonds financing to fund the program, while VA loans are actually offered by direct lenders, including banks and mortgage banks. CalVet uses a Contract of Sale, or Land Contract, or finance the property. This means that, rather than the Veteran holding title to the property, the State of California holds title to the property. There are a couple of advantages to this, such as potentially lower home owners insurance bills in tough to insure areas. But there are also disadvantages to this. (The home owner has to deal with the State of California when they need have questions on their loan.)
VA loan rates have been very low in 2010. Because the VA loan program is financed by lenders, interest rates are competitive with other types of mortgage programs. The CalVet program, with the source of funds coming from bond financing, can sometimes have lower rates, but at other times have higher rates than offered on the market. Most of 2009 and so far in 2010, CalVet has not been able to compete. CalVet interest rates since May 8, 2009 have been in the 5.75% to 6.2% range, depending on the program the Veteran qualifies for.
For most California Veterans, the lower interest rates currently available on the standard VA program will be enough reason to go that route. But things can change. It is important to discuss your options with an California VA loan specialist. Finding a, Orange County, CA VA loan lender who can provide customized loan scenarios should always be the first step in the home buying process.
Authored by Tim Storm, an Orange County, CA VA Loan Officer– Please contact my office at Alpine Mortgage Planning for more information about an Orange County, CA home loan. 877-786-4243 x 7.
Call our office today and see how we can help you and your family. Ask for your Free First Time Home Buyer Report.
877.786.4243 x 7 | tstorm (at) ochomebuyerloans.com
* Alpine Mortgage Planning is licensed and supervised by the Department of Corporations under the California Residential Mortgage Lending Act. NMLS 81395
*This is not an offer to lend. 
Obama Refinance Plan For San Jose Homeowners AnnouncedHome Affordable Refinance Program Update Harp 2 Bay Area San Francisco California March 2012 Guidelines for Purchasing a 3 to 4 Unit Property with FHA Financing in Alameda, CA8 Year Fixed to 30 Year Fixed. You Can Choose Your Loan Term In San Jose
