The VA Loan Occupancy Requirements

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The VA created its loan program to help veterans secure a home to live in, but it’s not a program to help veterans buy vacation homes or investment properties. It’s a flexible program that requires no down payment so veterans can buy a suitable place to live in easily. To keep the loan program within its parameters, the VA has specific occupancy requirements.

Certifying your Occupancy

When you apply for a VA loan, you must state that you’ll occupy the home as your primary residence. This means you plan to live in it full-time and move into it within a reasonable timeframe. Even if you own another home, your main address must be the home you buy with VA financing.

The lender will underwrite and process your loan under the assumption that you’ll live in the home as your primary residence. At the closing, you’ll again certify that you’ll occupy the home. The documents you sign are legally binding, so make sure you tell the truth on all forms and that you intend to occupy the property as your primary residence.

How Quickly Must you Occupy a VA Home?

The VA expects veterans to move into a home bought with VA financing within a reasonable time. This means approximately 60 days from the closing date. The VA considers the 2-month window adequate time to get situated, whether you’re moving stations, retiring from the service, or moving across the country.

If the 60-day window isn’t enough time, you may ask for a longer window, but the VA must approve your request. For example, many veterans secure a home before they retire from the military. If they find the perfect home a few months before they retire, they may not be able to move into it right away. In this case, they can ask the VA for an extension. The VA usually grants up to a 12-month extension for military members on the verge of retirement.

If your employment or military assignment prevents you from moving into the home within 2 months, you must prove it to the VA. With a letter from your employer or officer, you can prove that you are still actively working or serving in the military and can’t occupy the home yet. The VA approves the situations on a case-by-case basis.

Can a Spouse Satisfy the VA Occupancy Requirements?

If you are married, your spouse may satisfy the occupancy requirement. As long as one of you lives in the home within the 2-month window, you satisfy the occupancy requirement. If your spouse can’t occupy the property within 2 months, make sure you clear the situation up with the VA to avoid violating the regulations.

How Long must you Occupy the Home?

As long as you carry VA home loan financing, you must occupy the home. The VA provides 100 percent financing to help veterans secure a suitable home and stop renting. Sometimes circumstances change, though, and the VA recognizes that, which is why they have a few exceptions.

If you refinance your VA loan with the VA Interest Rate Reduction Refinance Loan (IRRRL) otherwise known as the streamline refinance loan, the VA only requires that you certify that you lived in the property. You don’t have to prove that you still occupy it. This is only for the VA IRRRL program, though, not the VA cash-out refinance. With the cash-out program, you must live in the home as your primary residence.

You may also use your remaining entitlement to buy another home. If you do, you must refinance your current home either using the VA streamline refinance or a non-VA program so you can abide by the owner occupancy requirement for the new loan and not have to worry about it with your existing home.

The VA home loan occupancy requirements get confusing. There are certain situations when the VA may allow an exception, but it’s on a case-by-case basis. I have many years working with the VA and can successfully help you navigate the system and determine if you are eligible for an exception.

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