VA loan question
I’m contacting your company to get some information about VA loans. I understand there’s an occupancy rule, that a person is supposed to be in the home within 60 days to meet the guidelines. I’ve been working with a person who is applying for a VA loan and wants to buy our home from us. The problem is that we haven’t found the home we want yet, so we’re still looking. He told us we could close on selling our home, then rent it back from him until we find another home—this could be several months before we find the home we want. He was wanting to do the rental agreement “under the table”. I’m not sure what the VA rules are and if he would have to disclose his intention of renting on his application—even if his intentions are to occupy the home eventually. If we made an agreement to rent back for 60 days only, would he still have to disclose the rental agreement? And would the loan officer need a rental agreement or other documentation about the agreement? The guy I’ve been working with is working with a company, Security National Mortgage. I can’t get any answers from them, so I’m reaching out to see I’m hoping someone from your company can provide some answers for me. I really appreciate any help you can give. by Eric.Roundy687 from Alamo, California. Sep 4th 2015
Richard Airey (richardairey)
#3 ranked lender in Maine - 662 contributions
I believe the only way VA would accept this situation is if the buyer were on active duty and could document his ability to occupy the property within the 60 days. Based on the scenario you described, if disclosed to the VA lender, it would not be approved as it would indicate an investment property. Different underwriters may interpret the guidelines differently, so it's best for the Veteran to ask his loan officer for clarification.
William J Acres (William_Acres)
#74 ranked lender in Arizona - 8,728 contributions
First, the VA guidelines are very clear.. the veteran must occupy the property within the first 60 days.. there are a few exceptions to this rule such as if the veteran was doing repairs before moving in or if he was deployed.. but otherwise, he has to occupy the property within the 60 days.. It's also very acceptable to do a 60 day lease back to give you time to find another home, and the underwriter should know about it.. Your scenario is a very common one, so i'm not sure why the loan officer or buyer is trying to keep it "Under the table".. this happens all the time and there's nothing illegal about it.. so i'm curious why he wants to keep it a secret.. Now if his intentions is to keep it as a rental, then that's loan fraud.. you cannot use VA to purchase anything other than a primary residence. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com NMLS# 226347
Thomas Slyman (loansbytom)
#752 ranked lender in California - 4 contributions
I can help you. Tom Slyman-Right Start Mortgage, tslyman@rightstartmortgage.com-714-585-9333 I am in CA. NMLS # 849050
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