VA Loans For Purchases In Other Countries
There are many scenarios potential VA borrowers bring with them to the bargaining table. Some VA borrowers are looking for typical suburban homes, others are looking for VA condo loans, and still others aren’t as choosy about the type of property they want to buy as they are about the type of loan.
Some VA borrowers want a VA Adjustable Rate Mortgage loan, others want a VA Graduated Payment Mortgage, etc. But what about VA loan applicants who want to buy homes outside the United States? Some military members stationed overseas decide to remain in that area after retirement or separation from the military.
The decision to stay in another country is often accompanied by the desire to own a home there, start a business, etc. Some military members marry in foreign countries and choose to remain close to the spouse’s family, others simply want to live somewhere else. The reasons for pursuing a new life in another land are as diverse as the reasons for applying for a VA home loan itself.
Does the Department of Veterans Affairs insure home loans in other countries?
Unfortunately the answer is no. According to VA Pamphlet 26-7 Chapter 3, Section 10, “Real property securing a VA-guaranteed loan must be located in the United States, its territories, or possessions.” Those possessions include Puerto Rico, Guam, Virgin Islands, American Samoa and the Northern Mariana Islands. This rule also precludes a borrower purchasing a home stateside while continuing to live overseas, because of the VA loan occupancy requirements which state the borrower must live in the home purchased with a VA insured mortgage.
Borrowers who want to purchase property in an overseas location may have, depending on the country, options based on their military status with local programs or nation-specific lending laws or agencies. But the Department of Veterans Affairs doesn’t have a program for home buyers outside the USA.
It’s important to note that a borrower can apply for a VA loan for a stateside home while still stationed overseas if the applicant intends to live on the property as his or her primary residence once the overseas tour is over. Usually the home buyer is required to move into the home within a reasonable time, but this can be waived depending on circumstances for up to (but no more than) about 12 months. Borrowers should contact the VA directly to learn whether their individual circumstances permit this.