VA loans

VA Joint Loans

November 18, 2010


VA Joint Loans

A first time home buyer who wants to buy a new home with a VA mortgage is likely thinking of the typical VA loan approach; a single applicant for VA home loan benefits.

But there are many more VA home loan options besides that traditional approach. For example, a VA borrower can apply for a VA joint loan which gives the veteran the option to have a co-signer. Co-signers on joint loans can include one or more fellow veterans who use their individual VA loan entitlement together on one home loan; the vets also have the option NOT to use their entitlement and let one co-borrower handle that responsibility.

Veterans and spouses can also apply for a VA joint loan; so can vets and non-vets. In the case of veterans and non-veteran borrowers, the VA will only guaranty the veteran’s portion of the loan and the vet must bear the majority of the financial responsibility on the loan. The veteran can’t be less responsible for paying the mortgage than the non-veteran borrowers. In the case of joint loans between a veteran and a non-vet who isn’t a spouse, VA approval is not automatic–such loans must be submitted to the Department of Veterans Affairs for approval first.

A joint loan between veterans has some perks other VA home loan offerings don’t. For example, when two or more qualified vets apply for a VA mortgage together, the property can include four family units, a business unit, AND an additional unit for each veteran applying for the joint loan. This is highly advantageous of the borrowers want to rent part of the property. VA occupancy rules still apply–all joint loan applicants covered by a VA loan guarantee must certify the property will be their primary residence.

These rules apply to joint loans on existing construction properties AND proposed construction, so two or more veterans could approach a loan without needing to find an existing structure to meet their needs on a multi-unit building.

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