Can you have multiple homes using your VA loan?

March 30, 2021 by Tess Pitzer1
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One of the most common occurrences is when an active military member has a Permanent Change of Station, and needs to relocate. Sometimes, it can be difficult to sell their current home. Home owners fancy the idea of using their current home as a rental property, and purchasing a second home in the new location. Although you cannot purchase a home under a VA loan with this intent, it is possible to purchase with a VA loan, then live in the property for a long time, and then eventually rent it out to others when relocating. Now, can you have multiple homes using your VA loan? The answer is yes! Today’s post will include how and why you may qualify for this, major considerations, entitlement, and one of our recent closings with a family that just bought their second home using a VA loan.

 

Entitlement

The VA backs a portion of every loan. This backing is known as a guaranty and is reflected in a dollar amount called “entitlement”. Now, VA buyers with their full VA loan entitlement can borrow as much as a lender is willing to lend, without the need for a down payment. Those with decreasing entitlement (whether it’s due to one or more active VA loans or previous default on a VA loan) may need to factor in a down payment when this time comes.
There are many more details regarding entitlement, and that is something that Heroes San Diego will be able to assist you with!

Rental Income

VA Homebuyers

Having two VA loans at the same time can be a challenge because you will need to be able to afford two mortgage payments. Borrowers planning to rent out their old home may be able to use that pending income to basically cancel out the old mortgage payment. Typically, lenders will treat this as an “offset” rather than an effective income.
Some things that may help you get in the right place to receive a second VA loan is if you have your new tenants signed into a 12- month lease. Then, if you are able to document their security deposit in your bank account. Last, you are not leasing the home to a family member.

Occupancy Requirements

Remember, this program is focused on assisting veterans and service members to purchase primary residences. There are occupancy requirements as far as purchasing a home that you will live in as your primary residence. You should probably be ready to move into this new home within 2 months of closing. Sometimes there are exceptions with the occupancy requirements. It really depends on your circumstances. These are details to be aware of, that we will discuss more in depth in our seminars.

Family purchases their second home with a VA loan

VA Homebuyers

A disabled military family purchased their second home using their VA benefits. As a disabled Vet, HSD notified hime that the VA funding fee would be waived. This saved him thousands of dollars when purchasing their new home. They attended our Active Military and Veterans VA Homebuyer webinar to learn about the VA loan process. Fortunately, they qualified and found their dream home all within 45 days! Not only this, but they also qualified for the Heroes San Diego rebate in which they received $3,200.00! This helped them pay their closing costs. Not only a huge savings, but also purchasing a home today is cheaper than paying rent!

Congratulations to our local Heroes on the purchase of their new home.

Can you have multiple homes using your VA loan? Yes!

Sign up for our free VA Homebuyer webinars, every Wednesday at 6pm. You can see our YouTube videos on our closures, and follow us on Facebook and Instagram @heroessandiego


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