Profile picture for AngelicaSuarez9

Buying a second home?

On August 2012, I bought my parents a house worth 220,000 under my name using a VA loan from USAA. At this time, this was also going to be my primary residence so getting a loan approved as primary was no problem. I just found out my finance and I are pregrant and therefore we would like to buy our own home. We would like to buy sometime in the summer of 2013.  My current credit score is 716. I have a few questions. 

1. How soon after the 1st purchase can I buy a second home?

2. Due to income limitations, I know I will not get approved for a second home unless I turn the 1st home into a investment property. What is the process to begin this? Is there any negative effects to my mortgage?

3. Can I purchase the 2nd home as the primary residence and therefore receive those interest rates?

4. Can I use a VA loan again to purchase the 2nd home?


  • September 12 2012 - Belleville
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Answers (8)

Profile picture for nwhome.us
I'm just going to stick with:

 Congratulations on the new member of your family!
  • September 12 2012
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Some great questions,
1) The new home must be your primary residence, confirm with a lender.  Also, you are suppose to have the intent to use for a minimum of 12 months, but don't think this is a requirement, ie the military transfers you 3 months after a duty station change, you bought a house, I think you can still by at new location, again this is a lender question.
2) Counting property as rental income can vary from not allowed for 2 years to allowing projected rental income based on strength of the market, I have done both, this depends on the new loan originator and their policy.  Also, how many months rent they might want you to have in the bank as a safety net.
3) The second home is your new primary residence, if it isn't stop, because mortgage fraud is serious business!  If the loan was scrutinized it is easy enough to look at things to see if home was purchased for someone else.
4) VA loan can be used infinitely, but entitlement varies based on area, here it is $470,000, so if you used $220,000 you may have more or less than $250,000 left, look on VA web site for your area..  Once you pay off the loan this frees up your entitlement to be used again.  ASll must be Primary residence.
  • September 12 2012
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Angelica-

You can in fact have two VA loans at the same time (expanding family size) and yes you can use the potential rental home from the home you are vacating to partially offset that mortgage payment (you will need to provide a lease).

Regarding your current VA mortgage you will need to contact your current servicer and request permision from them to move out of the residence prior to the 12 month period.  Provide that information to the lender doing your new VA mortgage and it should be fine.

Nic
  • September 12 2012
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Profile picture for wetdawgs
Talk to someone at the VA Regional Loan Center about possible restrictions on renting out a home with a VA loan after you've owned it for less than a year.   
  • September 12 2012
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Profile picture for AngelicaSuarez9
@wetdawgs.. The first home is my primary residence until we decide to buy the second home. If we apply for a conventional loan on the second home but as a primary residence and change the 1st primary residence as an investment would this impact my VA loan?
  • September 12 2012
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i would speak to someone that has the no how..

  • September 12 2012
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Profile picture for wetdawgs
You are likely in violation of your VA loan terms if you are not using it as your primary residence a month after purchase.   Refinance it as an investment property before moving forward.


  • September 12 2012
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Profile picture for Peter J Rogers
you better speak to a mortgage person as I do not have great confidence in your ability to do what you are thinking of doing and that is on several fronts.
It may well be that a VA loan is for a primary residence only
I don't think you can buy a secondary home on a VA loan
I think you will find that a loan on a second home would be at a higher rate than for a primary home
Banks will normally only consider 70% of net income of an investment toward your income needed to fund a loan
Now I am not a mortgage person but these are the sort of questions you need to answer whne they are asked of you and they most certainly will
  • September 12 2012
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