loans have had a record year, despite the tight conventional mortgage market. VA purchases increased nearly 13% year-over-year in 2014 (the VA's fiscal year runs Oct. 1 to Sept. 30), according to data from the Department of Veterans Affairs.
However, veterans could see a reduction in their purchasing power in 66 counties in 2015 if Congress doesn't renew the 125% median-home price, no-down payment limit. California, alone, hosts 11 of those counties.
The loan limits for high-cost areas were temporarily raised as part of Public Law 110-389, the Veterans' Benefits Improvement Act of 2008
. VA borrowers in most of the country can purchase up to $417,000 with no money down, but the VA has higher limits in more expensive areas to help military buyers afford homes. In some of the more costly areas of the U.S., single-family loan limits were as high as $1,094,625 in fiscal year 2014.
Currently, there are about 230 high-cost counties, including 70 with limits above $625,500. Unless Congress takes action by the end of December, military buyers in these costlier communities could suddenly face significant down payments that put homeownership out of reach.