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Form 26-1880 for re-instatement

by Dixie B.
(Las Vegas NV)

I used my VA loan to purchase a home in 2000 and sold it and paid off the loan in 2005. I'm applying for certificate of eligibility for re-instatement. How do I answer question 11A on form 26-1880 for the one-time only restoration since I no longer own the home do I check no?

=====ANSWERS=====

Hello Dixie,

Thank you for stopping by my site and asking your question. Sorry I was a little late getting you an answer.

I checked out the form you asked about. In the box for 11a, that is for VA use only. You do not have to fill out that box.

When they approve you for re-certification then they will put the date in the there and sign off in box 11b.

Please help me spread the word and tell others about my website.

Thank you,

Jeff Ragan

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VA Eligibility

by Richard
(Beckley, WV)

In about 1984 I had a VA loan but lost that house to a bank auction due to layoff from work. The new buyer paid to the bank an amount roughly equal to my outstanding mortgage less an amount approximately equal to my VA Entitlement. I believe that means that I lost my VA Entitlement.

But I am under the impression that I might now be eligible for a "secondary" VA Entitlement. Is that true? And if so, how should proceed to in order to get a new VA loan. Or do I need a new entitlement to secure a new VA loan?

=====ANSWER=====

Hello Richard,

Thanks for coming by my site. Also, I thank you for sharing with me enough details that I can make an intelligent answer rather than guessing what you mean.

I'm afraid that I do not have the best news for you. If the house that was foreclosed on was paid off in full so that none of your VA entitlement was used, then you would be able to have it restored. You indicate that the VA paid the lender the amount equal to your entitlement.

If that is indeed the case, until you repay the full amount of the entitlement paid to the lender, you will not be able to get a "secondary" one.

The "secondary" entitlement you may be referring to is what is available to Veterans that buy homes that are up to the Freddie Mac loan limit. For a single unit home that amounts to $417,000. So the Veteran could qualify up to 25% of that amount which is $104,250. The standard amount is $36,000.

So what this means is, if you were able to receive your entitlement assuming there was no foreclosure, then yes you could purchase a home and use your benefits once again.

I'm inserting a link to the VA website directly go to their Q&A section that will give you additional information. Just click here to see it.

Hopefully you find this helpful although I'm sure it is not what you want to hear. I'm sorry to hear that you had fallen on bad times in the past. I'm happy you have recovered and are in the market once again.

I suggest you take a look at the FHA 203b home loan. If your foreclosure was over 3 years ago (which certainly appears to be the case) then you may be able to get an FHA home loan.

I hope you find this helpful.

Kind Regards,

Jeffrey Ragan

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Certificate of Eligibility

by Walt
(Navarre, FL)

Entitlement code of "5" is indicated on my COE with the basic entitlement of $1820.00. $34,180 was charged to a previous VA loan. How much entitlement do I have to purchase another home? Does this mean that the VA will only guarantee $1820.00. The condo I am looking at to purchase is $60,000. Thanks!

=====ANSWER=====

Hello Walt,

Thanks for coming by my site and asking your question.

As you are no doubt aware, the VA Entitlement is the guarantee to the lender for your loan. Lenders like to see up to a 25% loan guarantee.

So in your case, the $60,000 condo, the lender would be looking for the $15,000 loan guarantee.

So if you have only $1,820.00 left on your entitlement, either they do not have a record of the sale of the property you purchased using the VA loan previously or you did not pay off the first loan and you still have the home.

You can get your entitlement restored to the full $36,000 if you file with the VA proof you sold the first home and paid off the loan in full.

I know the Veterans Benefit Act of 2004 changed these limits to 25% of the conforming loans amounts based on Freddie Mac (which makes the benefit much more) however you must still meet the requirements of having paid off the first loan to get your entitlements restored. You can only have one VA loan at a time.

I hope you find this helpful.

Kind Regards,

Jeffrey Ragan

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