Need clarification for VA borrower and multi-family

4 Replies

I have a military buyer looking to buy a MFR property and house hack. I'm getting conflicting advice from the loan officers and hope Bigger Pockets can help.

In short, MUST a VA borrower put down 20% (or any amount for that matter) on a triplex or fourplex. keyword=must. I know they "can," and I'm not looking for "can."

thanks

Originally posted by @Patrick Britton :

I have a military buyer looking to buy a MFR property and house hack. I'm getting conflicting advice from the loan officers and hope Bigger Pockets can help.

In short, MUST a VA borrower put down 20% (or any amount for that matter) on a triplex or fourplex. keyword=must. I know they "can," and I'm not looking for "can."

thanks

Assuming full VA entitlement (no existing VA loans), no they do not have to make a down payment.

Not all mortgage banks are fully honoring the new VA loan rules that came into effect 9 days ago. And even for banks that are, not all loan officers availed themselves of the very significant changes. Here are 3 links from va.gov directly:



https://www.benefits.va.gov/HOMELOANS/documents/circulars/26_19_30.pdf?fbclid=IwAR1jLbNJp2ofvL8CMEmRW2LfbzQqgcGQLFCDoYVo9SYCv1a1PNNyHc4Tmrc



https://www.benefits.va.gov/homeloans/documents/circulars/26_19_30_exhibita.pdf?fbclid=IwAR0FxAKswUGvEwRLdv5QRCU9oK5gG8DSySZY_ENu8ZrNSpjSInc1lSuMoKQ



https://www.benefits.va.gov/homeloans/documents/circulars/26_19_30_exhibitb.pdf?fbclid=IwAR1bDHMm-5EC32drv3zutwMLUKfgur1CiBzqIPDHzn39AVZ3B_lgz-rji7Q

@Patrick Britton you've got good reposes above and I just wanted to weigh in on why a lender might be saying such a thing. Maybe your customer cannot "afford" the house and needs 20% down? Maybe they aren't using the rental income for the property to help the customer qualify? In either case, I would reinforce that your customer needs to find a different lender. VA loans do allow rental income to be used immediately and if they cannot "afford" it...I would still get a 2nd opinion. Anyway, hope it all works out. Thanks!