Q&A: How To Buy a Multi-Family Unit Property With a VA Loan


Just by way of reminder, we wear red every Friday here at Low VA Rates. Even if I’m out of town, I wear red. Why? Because red for us is an outward expression of a real passion and love that we have for our military. RED stands for Remember Everyone Deployed. And whether deployed or not, we wear red every Friday as a way to say thank you for those that have served or are serving.

So with that. If you like red swag, as we call it, you’re welcome to take a picture of yourself wearing red on Friday, post it on the on Facebook or Instagram or wherever, put hashtag #RedFriday and tag @LowVARates, we’ll send you some red swag to sport yourself.

Today we’re going to talk about buying a multi-family unit property, specifically for veterans. That’s what I’m talking about today. This is a video geared primarily towards veterans. We try to make most of our mortgage videos all encompassing for civilians, conventional FHA, you name it. Today, specifically, we’re going to talk about VA. Specifically with VA. So a couple questions. Here are some potential questions.

First of all, it’s an amazing home. And multi-unit property is either a duplex, ie there’s two units at the house, a tri-plex or a four-plex. You cannot go over a four-plex. So it’s a 2-4 plex is what we’re talking about when we talk about multifamily.

It’s an amazing opportunity to, number one be a homeowner, but also be a real estate investor at the same time by renting out rooms number two, three or four to renters. So here’s some potential questions.

Can you buy a multi family residence with a VA loan?

Yes, you can. Absolutely you can, as long as it does not have more than four units.

Are the rates that you get on a multi-family property any different than the rates that you would get on a single family residence or a condo?

No, they’re not for veterans. Some products, they might consider a multi-family property more risky, and therefore they would elevate your interest rate. Keep in mind, as we’ve talked in the past on VA mortgages, you have to live in the property in order to use your VA mortgage. So if you think you’re going to buy a four plex or a duplex and just put renters in every single unit, you can’t do that with your VA loan. We can certainly help you do that with an investment loan or something outside of the VA. But with VA, you’re going to live in one of the units and you’re going to rent the others out. Because you’re living in the property, your interest rate will not be any higher than it would be for any other VA loan.

Can I somehow use future income from renters two, three or four in order to get approved for the loan?

Yes, you can. So let’s say you’re going to go out and buy a $600,000 4 Plex. You don’t make enough money to afford a $600,000 single family home. So you certainly don’t have enough money to afford the payment on a $600,000 multiplex. What you can do is you can use the income that you would derive from unit number two, three and or four to help you qualify for the mortgage. It’s awesome. Of course we’re not going to get into details on each one of these bullets today. But if you have questions, you can ask them live. I’ll try to answer them as we go. If not, we’ll come back later we’ll answer them below the video. And of course you can always call us um

Can all lenders give mortgages for multifamily unit properties?

Yes, all lenders can however I will tell you there are many lenders out there that won’t. Their risk tolerance isn’t where it should be or they’ve got other reasons to believe that these are not the types of loans they want to do. Here at Low VA Rates however, condos, single family, duplex, triplex, four Plex, we will lend on a multi unit property all day long for an eligible veteran.

What is different about getting a mortgage for a multi-unit property?

For veterans, there really is no difference. There’s no minimum FICO score. You get higher debt to income ratios as a veteran than you can on a conventional loan. You still got to get an appraisal and you have to have minimum property requirements that you meet, but there’s really no difference at all in the process to get approved for the loan on a multiplex if you’re a veteran.

What is the most important thing to review when looking for a multi family unit lender?

Really, don’t look anywhere other than Low VA Rates. Just kidding, making sure you guys are still paying attention. We are firm believers here in shopping around. We have videos on our YouTube channel about why it’s in your best interest to look at more than one lender when doing your mortgage. We know you’re gonna end up over here because our rates and our service are so much better than everybody else’s. But the most important thing to think about when you’re looking for a lender on a multifamily unit property, number one, ask them if they do it, and ask them how many of them they’ve done.

We do many multiplex unit properties here at Low VA Rates. We’d love to help you out. If you’re looking to buy a new home, consider getting into the real estate investment market by not just buying your own home, but also renting out the additional units that are in that multiplex, we’d love to help you out.


Transcribed by https://otter.ai