VA Loan Articles
VA Loan Requirements for Multi-Family UnitsVA loans have a variety of applications. Did you know you can apply for a VA home loan for properties with up to four units? The occupancy requirements for these types of properties is the same basic requirement as with single-family units, a borrower must certify their intent to live in one of the units as the primary residence.
VA business use requirements are also the same--the property cannot have more than 25% of the floor space dedicated to commercial use, but multi-unit properties are definitely an option for qualified VA loan applicants.
The difference in VA loans for multi-unit properties as opposed to single family homes starts when it comes to VA minimum property requirements (MPRS). The requirements are different for buildings with more than one unit due in part to the nature of the living conditions.
For example, consider the VA minimum property requirements designed to insure the privacy and accessibility for each unit on the property. The rules are intended to keep each living area as its own separate entity--and all utilities must be kept separate for each unit. Fortunately there are some exceptions for this rule for flexibility's sake.
According to the VA lender's guide "Utility services must be independent for each living unit" with the following exceptions:
1. Living units under one owner may share water, sewer, gas, or electricity as long as there are separate service shut-offs for each unit.
2. Living units under separate ownership may share connections from the main to the building line when those connections are protected by easement or covenant, and a maintenance agreement acceptable to Department of Veterans Affairs.
VA minimum property requirements for utilities also include a rule that utilities can't pass "over, under, or through" any other unit without "a legal provision for permanent right of access for maintenance and repair of the utilities without trespass on adjoining properties."
Some shared spaces on the property are permitted-the building can have a common facility for laundry or storage. Heating equipment for all units can be co-located in a single space. But when it comes to the individual privacy of each unit, VA rules require separate and self-contained spaces for each living space.