What are the VA Loan Occupancy Requirements?

As a veteran, you can secure 100% financing for a home purchase assuming that purchase is for your primary residence. The VA doesn’t guarantee loans for homes that veterans will use as a second home, investment home, or vacation home. They strictly help veterans buy a home to live in without needing a lot of money upfront.

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One of the stipulations of this loan is that you will occupy the property. Just how long do you have to move into the property and how long do you have to be there? We discuss these answers below.

Moving Into the Home

Once you close on a VA loan, the VA gives you ‘a reasonable amount of time’ to move into the home. In the VA’s eyes, this means 60 days. They feel that you should be able to move into the home you intend to live in full-time within two months. What happens if you can’t move into the home that fast? You have to meet one of the VA’s allowed exceptions.

First, you must certify that you fully intend to occupy the property on or before a specific date. Second, there should be evidence of some type of event that will make it possible for you to move into the home. For example, if you are still stationed away from the home and cannot reasonably commute, you can prove to the VA that you will move into the home upon your intended discharge date.

Be careful though, as the VA will very rarely grant an exception for delayed occupancy for more than 12 months.

What If You Can’t Satisfy the Occupancy Requirement?

If you can’t satisfy the occupancy requirement, you are at the risk of violating the VA’s requirements. Generally, this would be viewed as fraud. There is a way around it, though.

If you have a spouse or children that can occupy the property in your absence, it will satisfy the VA’s requirement. This only applies if you are active duty, though. If you can prove that it’s impossible for you to occupy the property within the intended time, you can have your family members occupy it for you.

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Occupancy After Retirement

Some veterans like to purchase a home where they will retire before they actually retire. Again, in this case, you may not be able to maintain your occupancy requirement until you are fully retired. The VA will allow an exception in this situation as long as you can prove that you will retire within the next 12 months. If your retirement is more than 12 months off, the VA won’t be able to allow VA financing.

Occupying the Property

One more topic to cover is the time you must spend at the home. What if you have to travel for work? Will the VA consider this inadequate residency? Luckily, as long as you can prove that you are at the home ‘most of the time’ and that your work is within a reasonable commuting distance unless you have to travel, you will be fine.

If your job is too far for you to comfortably commute or the VA has reason to believe that you have established occupancy elsewhere, there could be a problem. You must be able to prove to the VA that you are at the property most of the time and that you aren’t treating it as a seasonal home.

How Long Must You Live in the Home?

Many veterans wonder just how long they agreed to live in their home. The good news is that the VA doesn’t have a minimum requirement. The VA loan doesn’t have a prepayment penalty, so you are free to sell the home and pay the loan off whenever you need/want to.

While it’s in your best interest to stay in the home for at least a few years to allow the home to appreciate and your principal balance to get paid down, you don’t have to wait. If your circumstances change and you need to move, you won’t violate any VA rules if you leave the home.

The VA loan offers a great opportunity to buy a home with 100% financing. As long as you can satisfy the occupancy requirements, you have the opportunity to obtain flexible financing and purchase a home with little money upfront.

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