Most military borrowers know that they’re entitled to use a VA loan to buy a home in exchange for their service. VA loans allow military borrowers to access competitive interest rates without having to worry about the added financial burden of making a down payment or carrying private mortgage insurance.
But, if you’ve already bought a home, you may be wondering whether you can get a VA loan more than once. Fortunately, there are a few ways that you can use your benefits again. Keep reading to learn more.
What is VA entitlement?
Basic entitlement
Basic entitlement covers 25% of your loan amount, up to $36,000. With this type of entitlement, you could finance a house priced up to $144,000 without making a down payment.
Most military members, veterans, and families qualify for basic entitlement, provided you meet the following criteria:
- You’re an active-duty service member who has served for more than 90 consecutive days.
- You’re a veteran, National Guard, or Reserve member who meets the active-duty service requirements for your dates of service.
- You’re the spouse of a military member who died in the line of duty or from a related disability.
Bonus entitlement
However, since most homes cost more than $144,000 these days, the VA has introduced a secondary level of entitlement to compete with rising costs. Bonus entitlement does not have a cap and is meant to cover the gap between what basic entitlement will cover and your home loan amount.
Assuming you have access to your full entitlement benefits, the VA will guarantee 25% of your loan amount, up to the conforming loan limits in your area. The best way to find out your current entitlement benefit status is to ask for a Certificate of Eligibility (COE) from the Department of Veteran’s Affairs (VA).
How to get another VA loan
Now that you understand more about VA entitlement and how it works, it’s time to dig into the specifics of how you can use a VA loan more than once. Currently, there are three ways you can make it work:
Pay off your existing VA loan
The first is to pay off your existing VA loan in full. You can either do this over time or by selling the property and using the proceeds to repay the home loan. Once the loan has been repaid, you can then apply to have your benefits restored once by filling out VA Form 26-1880 and updating the “Previous VA Loans” information. After that form has been processed, you should be eligible to utilize your benefits again.
Have another veteran assume your loan
VA loans are assumable, which means they can be taken over by another willing party. If you find another qualified veteran to buy your home, they can assume your loan and swap your entitlement out for theirs, leaving you free to purchase another property.
Use your remaining entitlement
Lastly, it is possible to hold more than one VA loan at once. To do so, you just need to ensure that you have remaining entitlement benefits left after your initial home purchase. You can find your remaining entitlement benefits by subtracting 25% of your home loan amount from 25% of the conforming loan limit in your area.
Find a VA-friendly lender
Navigating the VA loan process is much easier with a knowledgeable lender by your side. Reach out to Premiere Nationwide Lending today if you have questions about how to access your benefits.
Premier Nationwide Lending is an Equal Housing Opportunity lender. Sponsored by NTFN, Inc. 6201 West Plano Parkway, Suite 100, Plano, TX 75093 | NTFN NMLS 75333.
