Getting a home loan through the VA can be an excellent way for eligible veterans and service members to purchase a home with no down payment. But what if you already used your VA loan benefit and now want to buy another home? Can you get a second VA mortgage?
The short answer is yes, you can get a second VA home loan under certain circumstances I’ll explain how it works, including key factors like VA loan entitlement, eligibility for multiple loans, and steps for qualifying
VA Loan Entitlement Limits
When you get a VA home loan, you tap into your VA entitlement benefit. This refers to the amount of the loan the VA guarantees. For loans made after January 1, 2020, the limit is $647,200 for most counties.
However, you don’t get unlimited entitlement. The VA sets a cap on how much they’ll guarantee over your lifetime.
So if you’ve already purchased a home using up some of your entitlement, you’ll have remaining eligibility for a second VA loan. But you can fully restore entitlement by paying off the loan on your first home.
Qualifying for a Second VA Mortgage
The main requirement for a second VA loan is you must intend to occupy the home as your primary residence. Lenders typically require you live there for at least 12 months before selling.
In addition, your lender will want to see:
- Good credit – VA doesn’t set a minimum score but lenders often want 620+
- Adequate income to cover both mortgage payments
- Enough entitlement to buy the home you want
It’s also possible to rent out your current VA home and purchase another primary residence with a new VA loan. But rental income can’t help you qualify by offsetting your DTI.
Steps to Getting a Second VA Home Loan
If you meet the above criteria, follow these key steps:
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Request your COE. This certificate of eligibility from VA proves you have remaining entitlement to use.
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Consider restoring full entitlement. To avoid a larger VA funding fee, you may want to sell your current home first.
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Get your finances in order. Review credit pay down debts, save for closing costs.
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Find a lender Shop VA loan rates and choose a lender you trust
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Submit your application. Provide documents to verify income, assets, and entitlement.
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Close on your new home. The lender will walk you through the entire closing process.
House vs. Condo: Which to Choose?
When buying a second home with VA financing, you can choose between a single-family house or a condo:
Houses
- More privacy
- Yard for pets/kids
- Potential for appreciation
- More responsibility for maintenance
Condos
- Less maintenance
- Potentially lower purchase price
- Shared amenities like pool
- Less privacy than house
Consider your lifestyle needs, budget, and local market when deciding on a house versus condo for your second VA loan.
Tips for Managing Multiple VA Mortgages
If you end up with two VA home loans at the same time, here are some tips:
- Be conservative when budgeting to ensure you can afford both payments
- Build up emergency savings to handle unexpected expenses
- Get a property manager if renting out your other home
- Consult a tax pro about write-offs for rental property
- Consider selling once market conditions allow
While juggling two mortgages can be challenging, being prepared eases the process.
alternatives to a Second VA Loan
If getting another VA loan doesn’t work for you, here are a couple potential alternatives:
Conventional Loan
You may qualify for better terms with a conventional mortgage. You can likely still use your VA benefit later.
Cash-Out Refinance
If you have equity in your current VA home, a cash-out refi can pull cash for a down payment on a new home.
Talk to a loan officer about these and other options if a second VA loan isn’t possible right now.
The Bottom Line
Veterans and service members who have fully used their VA loan benefit can qualify for another VA mortgage under specific circumstances. This includes selling your current home or proving you can handle both payments.
While getting VA approval for two concurrent loans may pose challenges, it can be done. If you’re eligible and need another VA home loan, start by requesting your COE and shopping lenders. With proper planning, you can enjoy the benefits of VA financing more than once.
Can I use a VA loan for a second home?
Its possible to get a VA loan for a second home, but there are limitations.
One of the most common circumstances is when an active military member has to PCS to a new duty station. Borrowers may keep their home because it’s difficult to sell. Others like the idea of using their first home as a rental property.
But how does the VA loan framework accommodate repeat buyers? Today, well walk you through the nuances of securing a second VA loan with common scenarios to guide you.
If You Foreclosed on Your First Home
If you foreclosed on your first VA loan, it doesnt mean youve lost the ability to get another one.
However, there are several barriers to getting a second VA loan. Weve created a comprehensive guide to walk you through getting a VA loan after foreclosure, but lets touch on some key points:
- VA lenders have a two-year minimum waiting period before they will allow you to borrow again
- Understand that youve lost some of your entitlement through foreclosure, which you can only restore if you pay the government in full
- Some lenders offer foreclosure forgiveness if the foreclosure was due to an extenuating circumstance (such as an illness or sudden death of a spouse)
VA Loan Secrets: What Veterans MUST Know about Using Multiple VA Loans (updated 2023)
FAQ
Can I get another VA loan if I already have one?
Does VA allow 2nd mortgages?
How long do you have to wait to use the VA home loan again?
Is there a funding fee on a second VA loan?
Can I get a second VA loan?
VA loans are designed to help eligible borrowers purchase or refinance a primary residence. But in some cases, you can buy a home using a VA loan, then refinance or buy another home with a separate VA loan. So, can you get a second VA home loan? Yes, but only in certain situations. Here are a few scenarios which may require an additional VA loan:
What is a second home in a VA loan?
In lending and in life, the main definition of second home is a vacation home that serves as a getaway from the everyday hustle and bustle. Because VA loans are intended to help people purchase or refinance a primary residence, you will have to follow the VA loan occupancy requirements.
How much does a second VA loan cost?
If you take out a second VA loan, the funding fee is something to keep in mind. You’ll pay a higher funding fee if you plan to put down less than 5% on the home purchase. Currently, veterans will pay a 3.6% funding fee when using a VA loan for the second time with a down payment of less than 5%. Can I get a VA loan after a foreclosure?
Can a veteran buy a second home with no down payment?
If a veteran wants to use a VA loan to purchase a second primary property with no down payment, you typically have to have enough entitlement left over to cover 25% of the overall loan amount because that’s what the VA would guarantee on the first loan.
Can you have two VA loans at the same time?
Technically you can have two VA loans at the same time. But the only way for this to be possible is for you to have entitlement remaining after getting your first VA loan. If you’re interested in getting a new home, the best approach is to make sure your first mortgage is paid off and your entitlement is restored.
Can I buy a second home with remaining VA entitlement?
If you do plan to buy a second home with remaining VA entitlement. It’s very important to make sure you understand how your remaining entitlement and local conforming loan limits interact. If you have any doubt, you can always speak to us. If you’re ready to get started, you can apply online or give us a call at (833) 326-6018.