VA Loan Second Tier Entitlement Help

5 Replies

Hopefully a VA home loan specialist can answer this question. I have used up my current primary entitlement. My wife and I want to buy another house in the same city using my second-tier entitlement. The house needs to be an upgrade (bigger) as I have a family member going through a divorce and they are going to need to stay with us a while including their two kids. My wife and I also want kids soon.

Will a VA underwriter possibly sign off on another loan because of these reasons?

@Michael Pitsos , what do you mean you "used up" your primary entitlement? Do you mean that you "used" it or that you borrowed the maximum amount? If you already borrowed the max then you are tapped out with nothing left to borrow. At least as far as I am aware. If you have not borrowed the maximum amount then you may be able to borrow more, but I am not 100% clear on how they calculate the amount you can borrow in what you call your second tier entitlement.

A VA underwriter will not sign off on another loan because of the reasons you listed. They will only sign off on another loan if you have any entitlement left and can afford the loan.

I would have to agree with @Edward B. They won't loan you more if you have borrowed the max amount, but depending on what state you live in, you actually get another loan with either no down payment or a smaller one. When I was enlisted I had 3 homes that I acquired through in 3 states, I used my VA loan for my primary residence and I took the other two loan from the states of Virginia and Florida, I had to provide a lot of paperwork, but in the end, it was worth it.

Thank you both for the reply. By used up, I mean I've used the maximum on my primary entitlement ($36,000) on my primary residence. I still have my second-tier entitlement available and need to get a bigger home. Eligible veterans in most parts of the country have a primary entitlement of $36,000 and an additional, secondary entitlement of $77,275. Add those together and you get $113,275. I know veterans can hold two VA loans under certain circumstances most primarily being they PCS and can't sell their home fast enough. I'm just wondering if my circumstances fits the criteria that an underwriter would sign off on.

@Michael Pitsos , I looked up second tier entitlement and I am tracking your question now. And to answer your question, I honestly have no idea. I knew you could have two VA loans if you had enough entitlement, but I did not realize that a second VA loan might require special circumstances. A PCS would obviously qualify and what you are asking is if your specific situation qualifies as well.

Based on what you have said you should still be able to borrow another ~$310k at 100%, but you would definitely have to be able to afford both loans with your DTI. As to whether your specific circumstances qualify you, you are right to be asking for a VA loan specialist, which I am not. If you don't get any bites here I would not hesitate to call around and ask a few. They are usually pretty easy to find online.

@Michael Pitsos  I'm assuming your home is where you've put in your profile and according to the  VA Loan Limits for BARTOW COUNTY, GA for a one unit home (SFR) is $453,100 and $580,150 for a two-unit so depending on how much you bought your primary home for you'll need to subtract that from the max limit and the remainder should still be available to utilize. Every VA Loan Lender has their own overlays that they want their applicants to meet to qualify for the Loan so make sure you shop around. If you need some good recommendations to some VA Loan Experts in your area to connect with let me know.

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