Yes, you can use your VA loan for rental properties.
According to VA loan guidelines, you can use a VA loan to purchase a multi-unit rental property (up to 4-units) if you intend to occupy one of the units.
The VA typically requires that the borrower move into the property within 60 days of closing and live there for at least one year.
The key to making rental properties work with your VA loan benefits is to meet the “primary residence requirement.”
For example, you could purchase a 4-unit rental property with a VA loan and live in one unit and rent out the other three.
Table of Contents
Summary of Key Points
- Yes, you can purchase up to a four-unit rental property with a VA loan. You can also rent out rooms or a guest house of your primary residence to generate extra income.The VA typically requires that the borrower move into the property within 60 days of closing and live in one of the units as your primary residence for at least one year.
- The VA typically requires that the borrower move into the property within 60 days of closing and live in one of the units as your primary residence for at least one year.
- Because you are allowed to have more than one VA loan, you can begin to build wealth through your VA loan benefits by purchasing numerous multi-family units over time. After fulfilling the occupancy requirement, you can move out and rent all the units.
Using a VA loan to Purchase Rental Property
In general, you can use a VA loan to buy an investment property so long as you live in one of the units.
Depending on the property, you can also get creative and potentially rent out rooms or a guest house to generate monthly income.
Primary Residence Requirement
The primary requirement of a VA loan is that you must certify that you intend to occupy the property as your primary residence.
This means that while you can use a VA loan to buy a property, at least one of the units must be occupied by the owner.
Multi-Unit Rental Properties Up to 4-Units
You are allowed to buy a property with up to four units using a VA loan if you live in one of the units.
This can be a way to purchase an investment property that generates income that you partially rent out while also meeting the primary residence requirement.
Additional Space in Your Primary Residence
If your property is spacious enough to allow for renting out a room or a guest house, this can be a great way to generate extra monthly income.
As long as you maintain the property as your primary residence, you have the flexibility to decide how to manage room rentals.
VA loan guidelines allow for the rental of extra space(s) from your primary residence.
Buying Additional Rental Properties
After fulfilling the occupancy requirement (generally for a year), you can move out and rent all the units.
This is often done by veterans who buy a home, live in it for the required period, and then purchase another home, potentially using another VA loan, while renting out the first.
Also keep in mind you can have multiple VA loans, meaning you can potentially get a second VA loan for rental property.
Qualified veterans can hold more than one VA loan at a time, which allows for the ownership of multiple properties.
VA Loan Investment Properties
Direct purchase of investment properties that will not be occupied by the owner at any time is not permitted with VA loans.
VA loan are designed for veterans to find affordable housing options, not to build investment portfolios.
But keep in mind that you can still buy investment properties with your VA loan if you meet the occupancy requirements.
Refinancing and Renting
If you originally purchased your home with a VA loan and lived in it but later moved out, you could refinance the home with a non-VA loan if you wish to keep it as a rental property, freeing up your VA loan entitlement for another property.
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About the Author
Brian Reese
Brian Reese is one of the top VA disability benefits experts in the world and bestselling author of You Deserve It: The Definitive Guide to Getting the Veteran Benefits You’ve Earned (Second Edition).
Brian’s frustration with the VA claim process led him to create VA Claims Insider, which provides disabled veterans with tips, strategies, and lessons learned to win their VA disability compensation claim, faster, even if they’ve already filed, been denied, gave up, or don’t know where to start.
As the founder of VA Claims Insider and CEO of Military Disability Made Easy, he has helped serve more than 10 million military members and veterans since 2013 through free online educational resources.
He is a former active duty Air Force officer with extensive experience leading hundreds of individuals and multi-functional teams in challenging international environments, including a combat tour to Afghanistan in 2011 supporting Operation ENDURING FREEDOM.
Brian is a Distinguished Graduate of Management from the United States Air Force Academy, Colorado Springs, CO, and he holds an MBA from Oklahoma State University’s Spears School of Business, Stillwater, OK, where he was a National Honor Scholar (Top 1% of Graduate School class).
