Is there a VA Second Tier Down Payment alternative?

[Daniel Bautista]

People of BP,

I am in the military and currently living in Colorado Springs, Co. I will be getting orders here shortly to Denver, Co moreover Aurora specifically.

Im currently using my VA entitlement and just initiated a VA IRRRL. Going from 3.5% to 2.875% @ 0 points. My projected after closing balance should be around 285k. I would like to purchase a home in Arapahoe County. The Va loan limit for the country is $596,850 which leaves me with roughly 310k. To my understanding I will need to bring 25% of excess amount in a form of a down payment. 3 bedrooms and up are around 385k ish and up.

Figures are for examples:

Funding fee is 13,860 @ 3.6% at 385k price

VA Loan (1) 285k and Loan (2) 385k with a different of 100K = 25k down payment

Or

Is it 385k (VA Loan 2) + 13,860 (Funding fee)

= 398,860

398,860 - 285k (VA loan 1) = $113,860 (difference VA 2 - VA 1)

Effectively making the down payment $28,465

My questions are;

1. Will the funding fee need to be factored in the total in front of the loan or in the butt of the loan, if so this will effect the down payment amount?

2. Does anyone know of any creative underwriting for the circumstance? Maybe like the previous home is generating income

3. Recommendations to an alternative mortgage loan.