Posted about 5 years ago

Can I Use a VA Loan to Purchase Multi-Family Property?

God bless America! Yes, you can use a VA loan to purchase a Two Flat, Three Flat or Four Flat in Chicago or anywhere else in the nation. Instead of buying that condo or single family home, buy a four flat, call it home and live for free from the rents of the other three units! What better way to start a new career in Real Estate Investing? To be eligible, you must be one of the following:

  • Veteran
  • Current or former National Guard or Reserve member who has been activated Federal active service
  • Active Duty Service member
  • Current National Guard or Reserve member who has never been Federal active service
  • Discharged member of the National Guard who has never been activated for Federal active service
  • Discharged member of the Selected Reserve who has never been activated for Federal active service
  • A Surviving Spouse in Receipt of DIC (Dependency & Indemnity Compensation) benefits
  • A Surviving Spouse and are not receiving DIC (Dependency & Indemnity Compensation) benefits

Assuming that you fit into one of these categories, the next step would be to speak to a lender who specializes in VA loans about the Certificate of Eligibility that is needed. Not all lenders will be well-versed with these loans, so save time and effort by using someone that’s closed a few of these before.

Using a VA loan in the end will be somewhat similar to a normal home purchase, but here are some of the highlights that you should be aware of:

  • For Illinois, the VA Loan Limit for 0% down (that’s correct, NO DOWN PAYMENT) for all counties is $417,000.
  • For Illinois, the VA Max Guaranty is $1,000,000. But once you get over $417,000, the lender will likely ask for a down payment from the buyer. Here is a good tutorial on how those down payments may be calculated.
  • Can be used to purchase 1-4 unit buildings, or 1 unit condo/townhomes, but buyer must occupy one or all of the units.
  • Cannot be used to purchase 5+ unit multi-family buildings.
  • No private mortgage insurance premiums (PMI).
  • Mortgage is assumable meaning that you can transfer the loan with the property to a new buyer or relative. Conventional loans typically aren’t assumable. This is a huge benefit especially as interest rates are on the rise.
  • Limited closing costs.
  • Closing costs can be paid by seller.
  • Don’t have to be a first-time buyer.
  • You can re-use the benefit.
  • Credit scores, payment history and debt-income ratios are still important and will be considered for the approval of the loan.
  • Appraisal is still required.
  • 75% of the rents from the non-occupied units will be used to help you qualify!

If you need help finding a VA Lender or a two flat, three flat or four flat in the Chicago area, I’m happy to assist.

Learn more at my website,

Comments (3)

  1. I know I’m very late on this post, but I have a question about this topic. Not necessarily if I can buy multi family using a VA loan, but on what kind of profits can one see coming from a 4 unit? I’m asking for maybe a rough estimate or maybe a general outlook of possible profits. If I were to buy a 4 unit I would love in 1 and rent out the other 3. So if anyone has insight on a rough possible profit I could potentially make from doing this please let me know. Thanks!

  2. Ahh yes! I wish I would have known this possibility before I bought my personal home. It was about six months later I found out I could get a four unit property! Great info to share! I do have a question though, why do Chicagoans use the term "flats"? It's quite European!

    1. I wish I had the answer to that question, but I don't. I even sifted through some google pages and came up with nothing! Flat is another word for apartment in Chicago. Using is what makes us unique - or British..