You can have previously-used entitlement "restored" one time only in order to purchase another home with a VA loan if the borrower has paid off the prior loan but still owns the property, and wants to use his entitlement to purchase a second home. This often occurs with active duty borrowers who PCS to a new station but want to keep their existing home for retirement.
However, if the prior loan has been paid off and the property is no longer owned, they can have their entitlement restored as many times as they want. They can re-use their VA eligibility for every home purchase from the first to the last.
Features and benefits of the VA loan program include the following - http://vastreamlinemortgage.net/va-mortgage-loan-advantages-
Investment Property Loophole
Essentially, the VA rules say “A residential property may not consist of more than four family units and one business unit except in the case of certain joint loans.”
This means that you can get a loan from a company that offers low VA rates and purchase a multi-family home with up to four units and a storefront.
You could live in one of the units, and earn income by renting out the remaining three. If you use the VA loan to purchase a multi-unit building with a storefront, you can also rent out the store front, or use it to run your own business.
From Residence to Investment
VA home loans don’t have caps, but each veteran has a certain amount that he is qualified to borrow without making a down payment. The average entitlement is $36,000, but some lenders will loan up to four times that amount, without requiring a down payment, if you meet the bank’s credit and income requirements.
> How to Make it Work:
* Purchase Property A – a four-unit home – with a VA loan.
* Rent out three of the units and live in one to satisfy the VA loan occupancy requirements.
* After a year, find determine your eligibility for an IRRRL. If eligible, take out an IRRRL on your Property A and continue living in the property.
* Start the process of getting approval for a second VA loan. Keep in mind that the entitlement you receive is the amount you can borrow with no money down. You could still qualify for a VA loan, with a small down payment even if you have used up your entitlement.
Reference Link: http://valoanguidelines.org/
I have been doing VA loans for many years and have not seen the VA move away from the requirment. Contact me with any other questions on VA loans
The first home can be rented to relatives, but not as a rent to own. The best thing to do is find a qualified VA lender to ask about your particular situation. I'd be happy to recommend one. I work with two that are really terrific!