How to free up you VA Loan Entitlement
Good Afternoon BP,
This is a question for fellow veterans who have bought a duplex or multi-family in the past and then went on to move out of the property to purchase a second. After a few years of searching I have found my ideal duplex (I'm way too picky) and am looking to buy it with no money down and inhabit it until I want to improve my living situation. Ideally I would do this with a more expensive duplex after a year or two. The home I am interested in purchasing is going to be around $265K in MA. The max entitlement in my county is $417K.
The Big Question is how do I free the $417K back up when I'm ready to move on. Can I refinance the initial loan into a different type of loan through a different bank ? Do I need a certain amount of equity in the property in order to do that? Since I'm going to be $250K in debt, am I going to run into major issues qualifying again. Will I be able to prove income when this happens?
I feel as though I've always just assumed that it would work itself out without performing my due diligence. I also love the idea of not paying a mortgage and living for free which is why I've liked the Duplex/VA Loan idea. It seems like there isn't a lot on the message boards about what to do after your first purchase though. Hopefully we can get a string here that clears it up and lays a blueprint for us veterans moving forward.