VA Occupancy Rules: A Reader Question
A reader asks, “When purchasing a home with a VA loan. What is considered a ‘reasonable time’ in which you must occupy the home? Also can you have a dependant live in the home and the purchasers not live in the home?”
VA occupancy rules define the reasonable time to occupy the property as no more than sixty days after closing. Exceptions may be made on a case-by-case basis (they are NOT automatic) if the borrower needs additional time, but this is subject to lender approval.
In any case, the borrower is required to occupy the property within the time agreed upon, which may not exceed one year. Again, any delay in occupancy beyond sixty days must be arranged with the lender.
In certain cases, a dependent is permitted to occupy the home in the borrower’s place. This is a recent change in VA loan rules (recent as in, within the last few years at the time of this writing) and depending on the age of the person or persons involved may require additional paperwork and certification.
Borrowers will need to make arrangements in advance for a dependent to occupy in the borrower’s place. According to VA Circular 26-12-9, “the occupancy requirement is also considered met if a dependent child occupies, or will occupy, the property as a home and the Veteran’s attorney-in-fact or the dependent child’s legal guardian makes the occupancy certification.”
Speak to your loan officer about the steps required to generate and file the required paperwork to allow a dependent child occupy the property on the borrower’s behalf.
Do you have questions about VA home loans? Ask us in the comments section. All comments are held for moderation.