What is the VA Loan Limit in 2023?
The VA loan limit in 2023 is NO LIMIT for VA borrowers with full entitlement, but there is a VA loan limit for borrowers with an outstanding VA loan or prior VA loan default. That limit is calculated using the Conforming Loan Limit in 2023 of $1,089,300 for Hawaii! That’s a $118,500 increase from 2022.
VA Buyers with Full Entitlement
VA loan eligible borrowers with full entitlement are:
- first-time users of their VA loan
- borrowers who used their VA loan benefit in the past, but do not have an outstanding VA mortgage
- borrowers with no prior VA loan defaults
VA buyers with full entitlement have no VA loan limit in 2023 that requires a down payment, but they must be PRE-APPROVED for the purchase price amount. That means if a VA buyer with full entitlement can afford to buy a home in Hawaii for $2 million dollars, then he or she can buy one with a VA loan and put zero down.
VA Buyers with Remaining Entitlement
Veterans can have more than one VA home loan. However, there is a maximum amount they can borrow on a second VA loan and make no down payment. They will need to know their “remaining entitlement” amount that is calculated using the “conforming loan limit” set by the Federal Housing Finance Agency (FHFA) each year.
Since the 2023 Conforming Loan Limit is $1,089,300 in Hawaii, we will use that amount to calculate remaining entitlement.
VA Loan Limit with Remaining Entitlement: Calculation & Down Payment Scenario
Lt. Commander Adams pays a VA mortgage on a $200,000 mainland home that he rents out. His goal is to purchase another home near his Hawaii military base using his remaining VA entitlement, so he contacts a local Hawaii lender and finds out that the Conforming Loan Limit is $1,089,300.
Note: This scenario is a simplified version of the remaining entitlement calculation. The full calculation generally yields the same result, but is more complex.
Remaining Entitlement Amount:
$1,089,300 – $200,000 = $889,300
Lt. Commander Adams can purchase a Hawaii home with no down payment for $889,300!
He gets pre-approved with Hawaii VA Loans and finds a home to purchase for $900,000. However, that price is above his remaining entitlement amount. He must put down 25% of the difference between the purchase price ($900,000) and his remaining entitlement ($889,300).
$900,000 – $889,300 = $10,700
25% of $10,700 is $2,675
Therefore, Lt. Commander Adams makes a $2,675 down payment on his purchase. That down payment is much more affordable than a 15-20% down payment needed on the TOTAL purchase price with a conventional loan!
Contact Hawaii VA Loans
Let’s help you become a Hawaii homeowner in 2023! Chat directly with a VA Loan Specialist at 808-792-4251 or get started online with our secure loan application.