How Many Times Can You Use a VA Loan?
A VA loan can help you achieve your dream of homeownership with more flexible lending criteria. However, these loans are only available for eligible veterans, active duty service members, and surviving spouses. If you’ve used your VA loan before or are considering using your entitlement to purchase your first house, you might wonder, “How many times can I use my VA loan?”
Believe it or not, you can use your VA loan more than once, and it’s a great option for borrowers who have already paid off their loan and want to move. However, how many times you can use your VA loan depends on several factors because you’ll have to meet both the VA and a private lender’s requirements and criteria to qualify.
How many times can you use a VA loan? If you’ve already used your VA loan and have remaining entitlement, you can use your VA loan as many times as you need. However, there are several things to keep in mind. Keep reading to get a better understanding of how many times you can use a VA loan.
- You can use your VA loan as many times as you want as long as you’re still eligible.
- Whether you qualify for a VA loan with a zero percent down payment depends on your remaining entitlement.
- VA loans are designed for primary residences, so while having two VA loans at once is possible, you must meet the VA’s occupancy requirements and pay both mortgages at once.
How Many Times Can You Use a VA Loan?
There’s no limit on how many times you can use your VA loan benefit. As long as you’re eligible according to the VA’s rules, the only restriction is your remaining entitlement. If you’re eligible for a VA loan, you’ll receive your entitlement, a specific amount guaranteed by the Department of Veterans Affairs.
Thus, how many times you can use a VA loan depends on whether or not you have full or partial entitlement. Even then, having partial entitlement won’t prevent you from using your VA loan a second time, but it may come with a down payment requirement.
Before using your VA benefit, we recommend learning how to get a VA loan to ensure you understand the process. Every time you use your VA loan, you’ll have to meet the various requirements of your lender and the VA.
Can You Have Multiple VA Loans at the Same Time?
How many VA loans can you have? Since you can use your VA benefit multiple times, you might wonder, “Can you have 2 VA loans at the same time?” VA loans are designed for primary residences. Therefore, you can’t get them for any type of property you don’t plan to live in. However, there are a few exceptions where you can have two properties financed with a VA loan simultaneously.
This is most common when active duty service members receive permanent change of station (PCS) orders, so they must move to a new location. If this happens, as long as you still qualify for a VA loan, you can get a second home with another VA loan. However, this is something you’ll have to discuss with your lender.
This example is a special circumstance, and the VA is willing to grant an exception. However, most people can’t use multiple VA loans simultaneously because the VA has specific occupancy requirements. For instance, you must live in the home for at least 12 months and move in within 60 days or a reasonable timeframe.
In any case, you’ll be responsible for paying both mortgages. That means meeting VA loan income requirements, having a good enough credit score, and proving your ability to repay both mortgages simultaneously. Additionally, you must have enough of your remaining entitlement left over from the first loan to get the benefit of the zero percent down payment associated with VA loans. You’ll be responsible for a down payment if you don’t have enough of your entitlement left.
From here, the next question you may ask yourself is, “Can I have three VA loans at the same time?” The answer is probably not. While it’s possible to use your VA loan as many times as you want, entitlement can become an issue with a second home purchase if you haven’t paid off the original loan in full and sold the home. At the same time, VA loans are meant for primary residences, and you can’t live in three places at once.
What Is VA Loan Entitlement?
Your entitlement is what the VA will pay to the lender if you default on your loan and is up to 25% of the total loan amount if you have your full entitlement. If you don’t have your full entitlement, the VA will guarantee part of the loan, and you may be responsible for providing a down payment to cover the 25% of the loan.
Full entitlement is the maximum amount the VA will guarantee the lender if you default on the loan and equals 25% of the loan amount. Full entitlement is crucial if you want to keep using your VA loan benefit without making a down payment. You have your full entitlement if you’ve never used your VA loan before, and you can restore full entitlement multiple times throughout your life, but it ultimately depends on whether you’ve paid off the loan and sold the property.
If you haven’t used your VA entitlement yet, read these first-time home buyer VA loan tips to learn more about the process.
Partial entitlement is when you’ve already used your VA loan, and your full entitlement hasn’t been restored. Someone may have partial entitlement if they:
- Are currently repaying the VA loan
- Fully repaid a VA loan but still own the home
- Refinanced the VA loan into a conventional or non-VA loan
- Get their home foreclosed
You can use the VA loan as many times as you want throughout your life as long as you have remaining entitlement. For example, if you’ve already purchased a home using your VA entitlement and haven’t paid off the loan and sold the home, you may still have partial entitlement that you can use to qualify for a loan. However, you may be required to make a down payment if the entitlement doesn’t cover 25% of the loan value.
The VA uses local conforming loan limits to determine whether your remaining entitlement will cover the 25% guarantee. Let’s look at an example in which you’ve already used $150,000 of your entitlement, and it hasn’t been restored. You’re interested in purchasing a property worth $250,000 in a location with a conforming loan limit of $726,200.
First, the VA will calculate 25% of the loan limit before subtracting your used entitlement. In this case, the equation will look something like this: 726,200 x 0.25 – 150,000 = $31,550.
Next, they’ll determine 25% of the total loan amount: $250,000 x 0.25 = $62,500
The VA will take the lesser amount, guaranteeing $31,550 of the loan. However, since you’ve already used your VA loan, you’ll be responsible for a down payment of $30,950 (62,500 – 31,550) to cover the 25% guarantee on the loan.
There are two types of VA loan entitlement: basic and bonus. Every eligible borrower is entitled to the basic entitlement of $36,000 based on the average home price of $144,000, and the VA allows you to borrow up to four times that amount. The bonus VA entitlement is similar but covers 25% of a home price above $144,000, so if you need a larger loan amount, you’ll use the bonus entitlement.
There’s no maximum loan amount for VA loans. Therefore, as long as you have full entitlement, the VA will guarantee up to 25% of your loan.
How to Take Out a Second VA Loan
To take out a second VA loan, you must determine your eligibility and calculate your remaining entitlement. If you’ve restored entitlement either by selling your first home financed with a VA loan or by using the VA’s one-time restoration, you won’t have to worry about making a down payment. However, if you have partial entitlement, the amount left may require a down payment to cover the 25% guaranteed amount.
Apply for a second VA home loan with Griffin Funding. We can obtain your Certificate of Eligibility (COE) to determine whether you have partial or full entitlement and discuss your options to help you use your VA loan a second or third time.
Restoring Your VA Loan
If you’ve previously used your VA loan, you may have partial entitlement. However, there are several ways to restore your VA loan to avoid down payments on your first, second, or third home purchase. A few ways you can restore your VA loan entitlement include:
- Repaying your first VA loan and selling the property
- Repaying the loan in full after a short sale or foreclosure
- Using the VA’s one-time restoration of entitlement after refinancing an existing VA loan into a non-VA loan
- Using the one-time restoration of entitlement if you’ve repaid the loan in full and want to keep the property
Restoring your loan is crucial because it can help you qualify for the VA loan and get larger loan amounts. You won’t have to make a down payment when you have full entitlement and can purchase homes in more expensive areas.
Apply for a VA Loan With Giffin Funding
Ready to use your VA loan again? Talk to a Griffin Funding mortgage specialist to learn about your options. We can help you determine your eligibility and remaining entitlement amount to ensure you can take full advantage of your VA loan benefits. Contact us today or apply online.
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