Homebuyers often ask, “What can I use my VA loan for?” There are some guidelines to know about before planning to use one to buy a home. Generally, and with some restrictions, VA loans can be used to purchase existing single-family homes, townhomes and condos, multifamily properties, permanently affixed mobile and manufactured homes, new construction, and sometimes land. However, not all lenders will provide loans on all property types. We break down some details for each property type so you can understand the process and steps you may need to take when considering a VA loan.
Key Takeaways
- You can use a VA loan for a variety of property types such as single-family homes, townhouses, condos, permanently affixed mobile and manufactured homes, as well as refinance an existing property or home. Some lenders may have restrictions on the property types they will lend on, so it is important to speak with your lender to know your options.
- When purchasing any property with a VA loan, the property must meet general VA loan appraisal requirements, and in some cases be on a list of approved companies like with condos or new construction.
- Sometimes the process may take longer with various property types, such as if you have a condo development not already on the VA’s approved list or are financing new construction, which needs a construction inspection.
- In general, it’s best to speak with your lending team to understand any specific guidelines depending on the type of property you’re looking to buy.
Buying a single-family home with a VA loan
If you’re eligible for a VA loan, buying an existing single-family home is one of the most straightforward purchases you can make with this type of mortgage. There are usually no guidelines on the price of the home if you have full eligibility. However, if you have remaining eligibility, there will be a VA loan limit based on your property’s location.
Usually, as long as the property meets the VA loan appraisal requirements, it’ll be eligible for a VA loan. You can speak with a VA loan lender like USAA Bank to understand the process and anything you’ll need to know about buying a single-family home with a VA loan.
Buying a condo with a VA loan
If you’re looking to buy a condominium, there’s an additional step to know about. The VA maintains a list of approved condos you can buy with a VA loan, which you can search on their website. If the condo development you’re looking to purchase isn’t on that list, you may still be able to purchase that property. However, there may be additional steps to take to submit the project to the VA for review to ensure that it complies with VA requirements.
As with a single-family home and any other property, a VA appraisal will need to be obtained and accepted by your lender.
Buying a townhouse with a VA loan
If you’re considering a townhouse, the process is very similar to the VA loan process with a single-family home. You’ll need to follow all the usual steps to qualifying for a VA loan.
Buying a multifamily property with a VA loan
You can usually buy a multifamily property of up to four units with a VA loan, if you will be living in one of the units. The process of buying a multifamily property with a VA loan is like buying a single-family home or townhouse.
Buying a mobile or manufactured home with a VA loan
You can usually buy a mobile home with a VA loan. However, you will need to meet a few other requirements for it to qualify for a VA loan, such as:
- the home must be permanently affixed to a foundation and meet local zoning requirements
- you’ll need to find a piece of land to put the mobile home on, whether it be a manufactured home park or a private property
A manufactured home has similar requirements to be eligible for a VA loan. According to the VA, it must be permanently affixed and classified as real property in the state where it is located. Some lenders do not lend on mobile or manufactured homes, so you’ll want to speak with them about your options.
Purchasing new construction with a VA loan
You may be able to buy a newly constructed home with a VA loan. You’ll need to confirm any requirements your lender has such as requiring that the builder is licensed, bonded, and insured to meet all state and local requirements. Additionally, a VA Construction inspection will be required.
You can choose your home builder or contractor, though they must be registered with the VA to obtain a VA builder identification number. You can search the VA approved builder registry online.
Purchasing land with a VA loan
This situation varies by lender. Many lenders don’t offer VA loans to buy land since land may not be considered a primary residence. If you are able to find a lender that approves land for a VA loan, you will be required to immediately build a home on it.
Updating a home with a VA loan
In some cases, you can use a VA loan to purchase and update a home. You’ll need to work with your VA loan lender to determine if you’re eligible and what options you have based on your property and personal circumstances.
What don’t VA loans cover?
There are some instances where you won’t be able to use a VA home loan to buy property, such as:
- Investment property - since you must live in the home you’re buying for it to qualify for a VA loan, this type of purchase isn’t eligible for a VA loan
- Property in poor condition - in this case, the home may not meet the VA appraisal requirements, so you likely won’t be able to use a VA loan to buy it
- Business property - VA loans can’t be used to purchase property intended to be used for business purposes, such as a commercial building or office space
- Land - as mentioned previously, this is sometimes not eligible for a VA loan
Do all VA loan lenders lend on all types of properties?
No, lenders may only provide VA home loans for certain types of property. For example, they may not provide VA loans for land. So, check with your lender like USAA Bank to confirm what they’ll offer and learn what you could qualify for when you go through the VA loan application process.
Can my VA loan be used for other things?
Sometimes a VA loan can be used to refinance an existing VA loan or to make updates to your home. Check with your lender like USAA Bank to see what your options are for VA loans, refinancing, or leveraging your home equity.
Are there requirements for different property types?
Sometimes, yes. For instance, with new construction there’s an inspection fee to cover that additional inspection. With condos, the condo development or builder must be on the VA’s approved list to be eligible for a VA loan.
Tools and resources provided by USAA Federal Savings Bank should be considered general advice and for informational purposes only. All information is subject to change without notice and may not apply to all members. Products, services or features mentioned may not be offered by USAA Federal Savings Bank. The information contained is not intended to represent any endorsement, expressed or implied, by USAA Federal Savings Bank or any affiliates.
Learn more about VA home loans
If you’re interested in learning more about a VA loan, you can speak with the USAA Bank lending team to learn more. Just fill out this form, and we’ll get in touch to share more about the savings, costs, and benefits of a VA home loan.
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