Using a VA loan to purchase your home is one of the smartest things you can do as ahome buyer. I have said time and time again that anyone that is entitled to a VA home loan and does not use it, has got to be very uneducated when it comes to understanding his/her VA benefits.
One place where Veterans have tried and keep trying to use their VA benefits and are struggling, is when it comes to buying a rental or investment property or when the veteran is not able to sell his/her current home and wants to rent it out in the meantime and then go buy a new home.
Perhaps the most constant guideline that all lenders have when it comes to VA loans, is that the home most be intended as your primary residence and that you can only have one VA loan outstanding at a time per veteran. The reason this VA loan guideline is pretty standard for all VA lenders is because it is an actual VA program guideline issued by the Department of Veterans Affairs.
I will attempt to layout some examples in the following table:
|
Veteran’s Question About the VA Loan and it’s Usage |
Simple Answer |
Suggestions for Veteran |
| Can I buy a home with a VA loan and rent it out to someone? | NO | If you are buying a multi unit property like a duplex or 4-plex and you are going to occupy one of the units then you could essentially buy a home with a VA loan and rent it out |
| Can I rent my current home that has a VA loan on it to someone else that is a NON-Veteran? | Yes | You will not be able to buy a new home with a VA loan until you refinance the home that is now being rented into a loan that is NON VA. |
| Can I have more than one VA loan at a time? | NO | Some exceptions to this rule are possible. If two veterans are married and one veteran had a VA loan on a home prior to getting married, then the two try to buy a home together once married; this could happen if the veteran that has not used his/her VA loan before is able to qualify. |
| Can a Veteran use a VA loan more than once? | Yes | It is possible to have unlimited access to your VA home loan eligibility. As long as you are able to sell your current home with a VA loan on it, then you can always buy again with a new VA loan. |
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There are always cases or questions that may not have been discussed in this post, and I hope you find the little bit of information I have shared useful. Should you need more details or have a specific question, I certainly hope you can find it on LowVARates.com or that you will feel free to submit your question to our Contact Us page.
Eric Kandell has worked in the mortgage industry since 1997. Since day one he has focused his mortgage efforts towards veterans and mastering VA loans. Eric is the owner of LowVARates.com and also manages a mortgage company full time. One of Eric’s claims to fame, is that seasoned VA underwriters will call him from time to time for information on some very intricate VA loan questions.Tags: entitlement, rent a VA home, va home loan, VA Loan, VA rental
If i was to purchase a multifamily home with aVA loan and intended on living there at the time of purchase in one of the units. If after purchase I was unable to move into one of the units…would I be able to rent that unit as well. What is the penalty?
yes you would as long as your intention was to occupy the property as your primary residence
My fiance purchased a home with a VA loan 3 years ago. I am about to purchase a home under my name only that we will make our home once we are married. We just don’t know what to do with his house? Can we rent it out? That would be ideal in our eyes. He lived in it for 3 years. He is also now retired from the army national guard. I don’t know if that makes a difference.
We’ve been told we can rent it out without penalty, but then we’ve been told that’s only true if you’re still in the military and forced to move due to that. We are so confused. Please help.
My husband and I have lived in our VA loan financed house for over 3 years and have recently refinanced it using a VA refinance loan. We are receiving military orders to another state and will now need to rent the house. Is there a penalty for doing this? The time difference between the refinance and our leaving is less than 3 months.
no penalty at all
best of luck to you
My wife and I currently own our home with a VA loan using my certificate. My wife is also retired military. Is it possible to rent out our current home and purchase a new home with my wifes VA certificate?
absolutely! Give us a call and we can get this started right away. This is called JOINT ENTITLEMENT and you are ready to go after a new home
Hi, my wife and I own a home in Florida. It’s totally paid off. I’m a veteran, and was wondering if I could purchase a home in Texas with a VA loan and spend about 3-6 months a year there?
My husband is 100% through the VA and we have our current home that was purchased with his VA certificate. We need a new home because we have grown out of the one that we bought in 2008. As we all know, the market is crap so to sell our house may put us in the negative a bit. Would we be able to rent this house out and buy a new one on his certificate too since everything says that we are VA qualified for 417000. I have heard that you can and heard that you can’t but I just don’t know. Do you know about this?
yes you could but you would need to make sure the loan was set up properly. Give us a call.
THis is a bit more tricky but we have VA loan officers that can help. Regardless of the 417K this does NOT mean you can get another VA loan. It will all come down to how much entitlment is left and we can help you determine that. Other options would be to refinance the house you have now into a FHA loan and free up your entire VA loan for the new house. Give us a call
i was just told u can not rent out a home if you get the fha loan..i was gonna try to free up our va loan to do that like u said.
Give me a call directly at 801-341-7023 so I can assist you. I am not sure who told you what but I want to help.
My husband is going to be transferred to another part of the state. Transfer is not military related. We aren’t able to sell right now because of the market. We were told after we lived in the house for a while it’s ok to rent it out. (By the time we’d need to rent it out we will have lived in the house for 3 years). I have also heard of people fighting with the va when they rented it out after 1-2 years of living in it. Do you know what the va deems a reasonable amount of time to occupy as the primary residence?
You can rent your house out no problem at all on a VA loan as long as you lived in the home when you bought it. You can even take advantage of the streamline. We do streamlines all the time for Vets renting out their homes. feel free to call and speak to me directly at 801-341-7023
I bought a house in another state and want to rent out my VA loan house to my son, which the payments will be same as the mortgage payment. I have lived in this house for 14yrs. Will I have any problems?
none at all
Me and my husband have lived in our home for 3.5 years. We just recently refinanced it with a VA streamline loan…no cash out just an intrest rate reduction. My husbands job is in jeapordy of being lost due to downsizing with the police department he works for. If he loses his job it will take him months to get a new one, if he can get one at all, so we have choosen to relocate for another job rather than stay here and risk him losing this one. He has been in the process of another job for 4 months, and is pretty certain to get it but it is 1800 miles away. We cannot sell our home because we are about 40k upside down (the economy being as it is) and we wanted to rent it out. I was told we could do this if we had lived in the home more than 3 years, but do we start that three years over at the point we refinanced it? We are not going to be renting it for a profit…we had to refinace it so that we could get even close to the mortgage payment when renting…we are going to lose about 250.00 a month. Is the VA going to get nasty with us about this? I havent been able to get a straight answer. Also, what are the chances we will be able to buy another house when we move. We don’t want a crappy rental forever and I don’t see the market getting any better anytime soon. We have good credit / our current house is in god standings. Thanks
There is actually no rule at all on how long you have to live there. You are fine to rent it out right away and the VA has nothing to do with that.
Eric,
I am going to be in the same situation with having to rent my current home wich is under a VA loan also. I just moved in to my new home in January 2011. I am currently working overseas in Iraq since I retired in 2006 and may be going home soon. I have a great possibility of getting a new job in Jacksonville, Fl but my current home is in TX. I am looking at renting out my home in TX which is under a VA loan and moving to FL. I can see from earlier posts that there is no rule at all on how long I have lived there. I was just wondering what kind of nasty mail the VA would send out if I do this?
The VA couldn’t care less and would actually never know. It is nothing at all to worry about. It is very common. We would love to help you get a new home in Fl so please look us up! You can stay in touch via http://www.facebook.com/lowvarates or just bookmark this blog. thanks for your service/
My wife and I are separating (amicably) with possible divorce down the road. Our plan is she will stay in the house (paid for, no VA loan used) and I move out. I have an opportunity to buy a small house and a VA-loan experienced broker friend is confident that a VA loan will not be a problem. While in the house I plan to make improvements that I am certain will increase its value. This is where my first potential problem comes up. My marital separation may reverse. If it does, I don’t want to remain in the second house waiting to sell simply because the VA says I have to live there. If I do sell immediately, potential exists for a profit and I don’t want the VA coming after me thinking I bought the house to flip. If I don’t sell immediately, I would want to rent versus just leaving it empty. Again, I don’t want the VA coming after me thinking I bought it simply to rent. Advice requested. Thanks.
The VA will have no idea or even care if and when you move out of the home. All that matters is that your intent was to live there when you bought it. Tons of VA loans are on home that were once lived in by the Vet and no longer are. There is absolutely no issue at all on this.
I am a reservist on military orders (back in the military full time) for 3 more years. My wife and I plan on retiring to S. Cali. Is it possible to purchase a home in S. Cal with a VA loan (we do not own a home at this time), have my wife live in it for a period of time (we’re renting in N Cali right now) and then rent the home out until we can all move to S Cal together?
You cannot do this. The VA require that you intend to move in immediately or within 30 days.