VA Loan Reader Question: Occupancy Requirements and Second Homes
A reader asks, “My husband works in one city where we would like to buy a condo using a VA loan. We also own another condo in another state and we spend equal time residing in both states. Would we be able to qualify with the occupancy requirements.”
This is a tricky question. The borrower’s stated, intended primary residence would seem to be the state where the VA loan is to be used to purchase the property. The fact that the borrower would divide time between one state or another isn’t an issue, as Chapter Three of the VA Lender’s Handbook states, “The veteran need not maintain a physical presence at the property on a daily basis” in order to fulfill VA loan occupancy requirements.”
VA borrowers who work out of state also have a provision in the rules which would allow them to get a VA mortgage. “…occupancy ‘as the veteran’s home’ implies that the home is located within reasonable proximity of the veteran’s place of employment. If the veteran’s employment requires the veteran’s absence from home a substantial amount of time, the following two conditions must be met:
- The veteran must have a history of continuous residence in the community, and
- There must be no indication that the veteran has established, intends to establish, or may be required to establish, a principal residence elsewhere.”
And there is a potential sticking point–VA loan rules say the borrower can’t already have one principal residence–the borrower must certify the residence to be purchased with the VA mortgage is the one he or she will use as the home address. That said, this portion of the VA rulebook seems to address a commuter work situation–does it also affect the answer to the reader question?
It’s not clear from a read of Chapter Three, Section Five (VA Occupancy Rules) of the rulebook. The best advice in this situation is for the borrower to call the VA directly at 1-800 827-1000 to get more information and clarification on VA loan occupancy requirements. The VA instructs lenders to do the same when confronted with complex occupancy questions that require a case-by-case evaluation. “Discuss unusual circumstances of occupancy with the appropriate VA office or submit a description of the circumstances to the VA office for prior approval.”