Does assuming a VA loan satisfy the 1 year residency requirement for rentals?

Question

I'm wondering if anyone has experience with VA loans and the 1 year residency requirement before you can use the home as a rental.  I'm looking into assuming VA loans with very low interest rates to be used as rentals.  Any other creative ways to satisfy the residency req?

Daniel Millner · Answer

Im a Vet and have done a few VA loans. To my understanding the VA only cares that the initial person that purchased the property had the intent to live there and make the home their primary. If something comes up where plans change they understand, but they want to be aware. You can talk with someone at the VA regarding this, but you will likely need to ask for a manager a few times to get the answer.I havent assumed any VA loans so thats bit outside my knowledge set, but they should be able to answer your question fully.Did the prior owner live there for at least 1 year? If so it may have already met the requirement for the loan.

JD Martin · Answer

When you assume the loan, unless you transfer the eligibility to yourself you are working off of the vets entitlement, so as long as they have met requirements you are good to go. I can't think of a good reason, other than maybe being underwater in a house that won't sell, that a vet would allow a non-vet to take ownership of their entitlement. I'm a veteran and I certainly wouldn't do it.