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Taking out multiple VA loans is possible for eligible veterans, service members, and their families. The VA home loan program is a valuable benefit that can be used more than once to purchase or refinance a home. However, there are some limitations and requirements to be aware of when obtaining more than one VA-backed mortgage.
Overview of VA Loans
VA loans are mortgage products backed by the U.S. Department of Veterans Affairs. They offer key advantages like no down payment, no private mortgage insurance (PMI), and lenient credit requirements. Basic eligibility includes having at least 90 days of active duty service and an honorable discharge. VA loans can be used to buy a primary residence or refinance an existing mortgage.
Using the VA Loan Benefit Multiple Times
The VA home loan entitlement can be reused over your lifetime. There is no set limit on the number of VA loans you can obtain Each time you use the program, your entitlement gets tied up in that mortgage Here are some common scenarios for multiple VA loans
- Refinancing with a VA streamline or cash-out refinance
- Selling a home with a VA loan and buying another property with a new VA mortgage
- Having two VA-backed mortgages at the same time on two homes
- Getting approved for a VA purchase loan after a VA foreclosure
Veterans can reuse their entitlement for multiple loans as long as they have sufficient remaining eligibility.
How VA Entitlement Works
VA entitlement refers to the amount the VA guarantees on a loan in case of default. This backing allows for $0 down mortgages. Entitlement is typically 25% of the loan amount. There are two tiers:
- Basic entitlement is $36,000
- Secondary entitlement is $144,000
So on a $200,000 purchase loan, you would use around $50,000 of entitlement. This would leave you with $130,000 that can be applied to another VA mortgage.
If you exceed your available entitlement, a down payment is required on the portion that surpasses your eligibility.
Having Two VA Loans at the Same Time
It is possible to have two VA loans at once for two separate primary residences. Having two VA loans at once typically applies to active service members who receive PCS orders. Rather than sell the home, you could look to rent it out and buy again at the new duty station using your remaining VA loan entitlement.
For example, if you used $50,000 of your entitlement on the first home, you would have around $130,000 left to put toward the second mortgage. This would allow you to buy another property for up to $520,000 with no down payment. Anything above that amount would require a 25% down payment on the excess over the available entitlement.
Juggling two mortgage payments can be challenging when it comes to debt-to-income ratios. Having a tenant helps cover the cost of the original home.
VA Loan After Foreclosure
Veterans whose VA loan went through foreclosure or short sale may still be able to reuse their benefit and buy again with a VA mortgage after a waiting period.
If the foreclosure tied up some of your entitlement, that amount would be unavailable to apply to the new loan. For example, if the foreclosed loan used $50,000 of your eligibility, you would have around $130,000 left to put toward another VA purchase.
The minimum loan amount is $144,000 when using second-tier entitlement. And there is a two-year waiting period before getting a new VA-backed mortgage after foreclosure.
Key Considerations for Multiple VA Loans
Here are some important factors to keep in mind with multiple VA home loans:
- Each time the benefit is used, the VA funding fee may be higher. Disabled veterans can be exempt.
- You can’t have more than two VA loans at once for primary residences.
- Managing two mortgage payments can be difficult based on debt-to-income ratios. Rental income helps offset the cost.
- Remaining entitlement must be sufficient to meet loan requirements if exceeded, a down payment would be needed.
- There’s a two-year waiting period to reuse VA entitlement after foreclosure.
Working with a VA Specialist
The rules around multiple VA loans can be complex. Connecting with a VA mortgage expert is the best way to navigate the process and determine the optimal loan amount and strategy for your situation.
The Bottom Line
Qualified veterans, military members, and families can use the VA home loan benefit more than once over a lifetime. Understanding the entitlement, eligibility, limitations, and requirements is key to successfully obtaining multiple VA-backed mortgages. Connecting with a lender specializing in VA loans ensures you maximize this hard-earned benefit.
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Restoring your VA mortgage entitlement
Remember: You have an entitlement limit, but you can restore your entitlement by selling your home and paying off the VA loan in full. If your loan is merely paid off or refinanced and you still own the house, the entitlement amount remains tied up in the home.
Fortunately, there’s an exception: You can request a one-time restoration of entitlement benefit, even if you’ve not met the VA’s must-sell rule. Say the buyer of your home for sale is a veteran who takes over your existing VA mortgage (called an “assumption”).
“You can ask this person to substitute his or her entitlement for the same amount of entitlement you originally used. If they agree, your original entitlement will be restored,” says Yvette Clermont, a mortgage consultant with Waukesha, Wisconsin-based Novus Home Mortgage.
If the buyer disagrees, the entitlement you used to buy the home will remain tied up in the property until the new owner fully repays the loan.
VA Loan Secrets: How to Use Multiple VA Loans (at the same time)
FAQ
Can you have two VA home loans at the same time?
Can I use my VA loan if I already own a house?
What is the max VA loan entitlement?
Can I borrow more on a VA loan?
Why is a VA loan better than a normal loan?
VA loans typically have lower interest rates than conventional loans and require no down payment. They also come without mortgage insurance costs, which limit your buying power. Conventional loans feature no government guarantees and adhere to the standards and requirements of government sponsored enterprises Fannie Mae and Freddie Mac.
How many VA loans can I have at one time?
The simple answer to this question is as many as you’d like. When a lender looks at your county’s conforming loan limits and your entitlement, they can help you buy a home with a VA Loan. You can even have 2 at once under certain circumstances.
Can you use a VA home loan more than once?
You can use a VA loan as many times as you like for life, as long as you are eligible. While there is no limit on the number of times you can use a VA loan, they come with other limitations you should know about. (Getty Images) If you serve in the military or are a veteran, a Veterans Affairs loan can help you unlock the door to your dream home.
Can you have more than one payday loan in VA?
The VA loan is a life-long benefit, and there’s no limit on how many VA loans you can have in a lifetime. Veterans can use the VA loan as many times as they wish if they have remaining entitlement. It’s even possible to have two VA loans at once, which we discuss more below .