The idea of buying a building intended as a rental property is sound--but VA mortgages aren't intended for this purpose. If you buy a home with a VA home loan, you must certify that you intend to "personally" live in the house. There are naturally exceptions made for houses that are in the building stages when the sale is made, but the general rule is you must occupy the house within sixty days of the loan closing. The occupancy requirement applies to all VA guaranteed loans except one; the Interest Rate Reduction Refinancing Loan or IRRRL. For these loans, the veteran is required to certify that the dwelling was previously occupied as the home.
FREQUENTLY ASKED QUESTION # 23 [ -more VA Loan questions- ] - - - - - - Q: Does the VA Charge A Fee? - Are there fees associated with my VA home loan?
A: There is a "VA funding fee" required by law. A first-time buyer will pay a little over two percent for a 'no money down' loan, and a second time buyer's fee is just above three percent. The reason for the fee includes the idea that the veteran is reducing taxpayer burden by contributing to the cost of his VA mortgage. The higher fee for second-time borrowers presumes that there is equity in the home, or the borrower has had plenty of time to save in order to pay for the extra percentage. There is also a fee for VA refinance loans, and they fall within the same general price guidelines; just above two percent for first-timers and just above three percent for those who borrow again.
VA Loan Rates
for 7/04/2009
30 year fixed
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0.000 points
5.500%
5.610% APR
15 year fixed
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0.000 points
5.500%
5.686% APR
Serving the military community with personal loans from $500 to $10k.
