In the realm of American real estate, affordability is a significant hurdle, particularly for those aiming to secure their dream home or venture into investment properties. The daunting prospect of accumulating a 20% down payment often leads to challenges, with private mortgage insurance adding an additional burden for those unable to meet this threshold.
However, there exists an exceptional avenue that allows some individuals to seamlessly acquire both an investment property and a primary residence without the constraints of down payments or private mortgage insurance. This strategic approach is specifically tailored for qualifying Veterans and service members eligible for the VA home loan benefit.
The VA Home Loan Advantage for Multi-Unit Properties
The VA home loan benefit extends beyond traditional home purchases, presenting a unique opportunity to acquire multi-unit properties. Whether it's a duplex, tri-plex, or quad-plex, Veterans can leverage their VA loan to purchase up to a 4-unit property. The key requirement is primary occupancy, necessitating that the buyer lives in one of the units. The secret lies in renting out the other units, with rental income effectively offsetting a significant portion, if not all, of the mortgage payment for the entire property.
Example Scenario:
- Duplex (2 units)
- Purchase Price: $400,000
- Monthly total payment: $3,300
- Occupying 1 unit
- Monthly rental income for the 2nd unit: $1,800
In this scenario, an investment property valued at least $400,000 is acquired with $0 down payment and no private mortgage insurance. After factoring in rental income, the out-of-pocket monthly payment is reduced to $1,500.
The Power of Two VA Loans and Building Wealth
For those ready to take their real estate journey further, the possibility of having TWO VA loans simultaneously opens up exciting prospects. After residing in the first duplex for at least a year, Veterans can utilize the VA home loan benefit again to purchase another property with potentially no money down or private mortgage insurance.
As equity accumulates in the first duplex, a strategic move involves refinancing the current balance to a conventional loan. This action reinstates the basic VA entitlement, paving the way for the purchase of a THIRD duplex or another multi-unit property.
Through discipline and diligence, this approach can lead to owning 6+ rental units without ever making a down payment or dealing with private mortgage insurance.
Taking the First Step
For those intrigued by these possibilities, securing a certificate of eligibility and VA preapproval is the initial step. Feel free to contact me today for a complimentary copy, allowing you to explore the potential opportunities available to you.
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Verification of VA Loan Eligibility for Additional Homes
Curious about using the VA loan on another home without selling your current one? Discover the steps to verify eligibility and explore new possibilities in your real estate journey.
Unlock the doors to homeownership and investment opportunities with strategic VA home loan utilization. Your dream property might be closer than you think!
Contact me today to get a free copy of your VA certificate of eligibility and see how much you qualify for at TerryRoberts.com
Terry Roberts is a U.S. Marine Corps Veteran and specializes in residential mortgages, including new construction, conventional, FHA, and VA home loans. He has helped more than 10,000 clients start the home buying process across America. Learn more about Terry.
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