All Forum Posts by: Brendan M.

Great job, this post is exemplary - narrative, numbers, and pictures. Thanks for posting!

@Tyler Flagg I used this form I found through the va.gov website. It was a shot in the dark, but they replied surprisingly quickly (2 days I think?) with a pretty thorough response. They also gave me resources to contact my local VA office to follow up with further questions.

Overall I'd say I was pleasantly surprised with the level of customer service, considering I wasn't really sure I'd hear back about anything I entered in on that form.

@Tyler (not sure how to tag on mobile), I wrote to the VA and this is what they responded with:

"The maximum number of units is 4. The residential appraisal form 1025 for multiple unit properties is for 2 to 4 units. Anything larger than 4 units requires a commercial appraisal and by definition is a commercial property and not eligible for VA guaranty. With regard to zoning, VA requires that residential be an allowable usage no matter the zoning type and the highest and best use of the property must be residential and not commercial. The property must be residential in nature. We see many properties that are in an area that was zoned residential and later became commercial/residential and are still acceptable since residential usage was still typical in the area."

So maybe you could do 5 of one was an office, but I'm not sure. Couldn't hurt to try!

@Jonathan (tagging doesn't seem to work mobile) thanks for the reply and advice.

For anyone else who finds this post with the same question as me regarding 5+ units, I messaged the VA and got this answer:

"The maximum number of units is 4. The residential appraisal form 1025 for multiple unit properties is for 2 to 4 units. Anything larger than 4 units requires a commercial appraisal and by definition is a commercial property and not eligible for VA guaranty. With regard to zoning, VA requires that residential be an allowable usage no matter the zoning type and the highest and best use of the property must be residential and not commercial. The property must be residential in nature. We see many properties that are in an area that was zoned residential and later became commercial/residential and are still acceptable since residential usage was still typical in the area."

Hope that helps!

According to this post, VA loans can be used to secure commercial property if it was originally zoned to be residential, which is great news. That said, the example in the above post is still less than 4-units, which is the VA's cut-off for residential to commercial. Does anyone know if a property that was originally zoned residential but rezoned to commercial, but has 5+ units is eligible for VA, assuming all other eligibility guidelines are met?

For anyone interested, here's the legal document governing the VA Loan Guaranty Program, I tried interpreting it in light of the above information, but I'm really not that great at interpreting legal speak.

@Jonathan Dudley One more question here, are rezoned properties (previously residential) with greater than 4 units va loan eligible? E.g. If I find rezoned a 7-unit property, do you have any idea if that would that still qualify?

Thanks again, I really appreciate the context. Very unfortunate for those that got hit hard, and pretty scary to think this could happen again.

Thanks for the thought out reply! Any idea who were the major losers in the crash - as in was there one particular investment strategy that got hit the hardest?

Respectfully, I disagree with you here. As they say, a bird in the hand is worth two in the bush. Contributing that extra $400 a month to savings it'd take him over 4 years to build back up to $20k. Also when planning for life's uncertainties, an immediate and liquid lump sum is much more useful than extra cash flow.

Interesting, that's good to know! Another interesting tidbit I recently found out is that apparently you can list your projected rental income for VA loan multifamily homes without having a history as a landlord, provided the rental contracts are in place prior to purchase. That said, I'm not sure the details and I haven't actually tried this, so if it's something you're interested in, it's probably worth discussing with your mortgage broker.

How many units are in the property? Any tips or tricks for finding reclassified properties like this?