Leaving active duty, VA home loan/funding difficulties

3 Replies

Good afternoon BP!

As the title states I am soon to be leaving active duty with the Marine Corps after 8 years and will be moving back the the great state of Wisconsin, Green Bay to be specific.

Scenario:

I have about 8 months left and am looking to finance a duplex using my VA home loan, with the intent of house hacking it..

I recently closed my first conventionally funded investment property in Milwaukee, so currently I don’t have the funds to just run a conventional loan “house hack”.

I have submitted pre approval requests to 4-5 VA loan-friendly lenders and each one is denied for the same reason as the last... They see that I am leaving active duty and immediately say no thank you, call us back 6-12 months after your "change of industries". Fair enough, I can understand that in the eyes of the lender i'm just a dude about to quit his job looking for a loan. However, not only am I not a fan of the "no" word, I'd still very much like to have a home to move back to next summer.

I am curious if there’s anybody out there who has experienced this scenario, and would love to know if anyone has any advice,tips or tricks to get this ball rolling.

Thanks in advance!

If you insist on using a VA loan, it's written in VA guidelines in black/white that only folks re-upping can use their military income as qualifying income within 12 months of EAS.

FHA or conventional, you could likely do now, but then what you're up against is "oh so you're going to commute from Mulwaukee to Camp Lejune 5 days a week? I think not..."

I get it, I got out of the Marines after 8 years too, but just sit tight. The "house hacking" you CAN do is with your GI Bill: GI Bill BAH is based on the zip code of your school, not based on where you live. So go to school in the most expensive area near you, and commute in from somewhere cheap. Assuming you continue to live modestly, you will come out of college more wealthy than when you entered it. This was many years ago, but I was pulling in $3900 tax free for Berkeley BAH, and paying $1100/mo in rent, oh and unlike all of my classmates I wasn't going into student loan debt. 

@Chris Mason Thank you for the facts about the VA loan and the insights my friend, I do plan on doing a version of your example, unfortunately I don't believe the spread will be as lucrative in small town WI lol. Based on your experience as a lender, what is my likelihood of having a "letter of intent to employ" accepted by an institution?

Originally posted by @Chris Piette :

@Chris Mason Thank you for the facts about the VA loan and the insights my friend, I do plan on doing a version of your example, unfortunately I don't believe the spread will be as lucrative in small town WI lol. Based on your experience as a lender, what is my likelihood of having a "letter of intent to employ" accepted by an institution?

"Letter of intent" sounds like it'll have uncertain language in it. They need to be certainly unambiguously hiring you with a specific start date, salary, etc.