Can Non-Vets Assume VA loans?

[Justin Brickman]

Hey all, I have a client that's looking to scale his portfolio and we're looking at Assumable Loans here in San Antonio. When researching online, it looks there are some instances where non-vets can assume VA loans, but the veteran's entitlement would remain tied to the loan.

How common is this and are there ever situations when this a win-win for both sides?

[Ryan Thomson]

@Justin Brickman This is a great idea and I am trying to do this in San Antonio as well actually. We could team up potentially. Anyways....

I have closed 7 of these deals in Colorado last quarter. You can absolutely assume a VA loan as an investor. This is not very well known, but it's an awesome way to buy investment properties.

It of course has to be a win/win for everyone. But there are a lot of reasons that a Veteran would be willing to leave their entitlement with the home: 

1. They have a partner who is also military and they don't need two VA loans

2. They really want to sell and don't plan on buying another property

3. They have a ton of equity in their home and are going to put 20% down on the next property so they can just use a conventional loan.

4. Their home is not selling otherwise and they would like to take full advantage of their VA loan by letting someone assume their loan. This allows them to sell them home when it otherwise might not have sold.

5. They have enough entitlement to actually go and buy another home with their VA loan. Lots of Veterans are able to take out 2 or 3 mortgages with their VA loan entitlement.

6. They realize that while the VA loan is awesome, there are other really great low down payment loans and down payment assistance. Sometimes it even makes better financial sense to go get a loan with a 3.5% down conventional loan and get a 0% interest down payment assistance to cover the down payment.

7. etc, etc etc 

There are a lot of reasons. And obviously the Veteran needs to be fully educated on the consequences of leaving their entitlement with the house, but this can be a huge win/win.

1. The Veteran sells their home quicker than they would have otherwise.

2. The Veteran can potentially sell for a premium.

3. The Veteran can take full advantage of their VA loan by selling quickly and at a premium and then go use it again for the next property (in some circumstances).

Let's connect!