Assuming a VA loan

[Anonymous]

I’ve read a lot of web pages about this, and it looks like I don’t need to be a servicemember or veteran. But the listing often says “subject to VA eligibility” or similar. What does that mean?

[Anonymous]

Anonymous wrote:I’ve read a lot of web pages about this, and it looks like I don’t need to be a servicemember or veteran. But the listing often says “subject to VA eligibility” or similar. What does that mean?

It means the seller wants to sell to a VA-eligible buyer, so you can “swap” your eligibility.

So buyer gets to assume the 3 percent interest rate, but seller still gets to keep their eligibility for zero percent down on their next house and doesn’t have the risk other future eligibility getting ruined if buyer defaults.

[Anonymous]

Oh. Are there some Assumable loans that are open to non VA eligible people? Or should I stop looking at those houses?

[Anonymous]

Anonymous wrote:Oh. Are there some Assumable loans that are open to non VA eligible people? Or should I stop looking at those houses?

FHA loans are assumable.

[Anonymous]

Anonymous wrote:Oh. Are there some Assumable loans that are open to non VA eligible people? Or should I stop looking at those houses?

VA loans can be assumed by civilians.
For example, I bought a million dollar house (that isn't the current max for a VA loan but the numbers don't matter) and I have a great rate and want to let the next buyer assume it. If that person also has eligibility, they can take that over and use their own eligibility. If they do not, I can let them assume my loan but I also give up my eligibility meaning that if I want to get another VA loan for my next house purchase, I likely can't (or don't have the full amount available to me).

[Anonymous]

Anonymous wrote:Oh. Are there some Assumable loans that are open to non VA eligible people? Or should I stop looking at those houses?

Most likely you should stop looking.
You can't take out another loan in addition to the assumable loan, so unless you have the cash to cover the purchase price less whatever is left on the mortgage, it's not going to work for you.
They are very limited in use.

[Anonymous]

Is there a way to search for assumable properties?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Oh. Are there some Assumable loans that are open to non VA eligible people? Or should I stop looking at those houses?

Most likely you should stop looking.
You can't take out another loan in addition to the assumable loan, so unless you have the cash to cover the purchase price less whatever is left on the mortgage, it's not going to work for you.
They are very limited in use.

Of course you can take out a second mortgage in addition to the assumable VA loan. Not sure why you thought otherwise but you are wrong.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Oh. Are there some Assumable loans that are open to non VA eligible people? Or should I stop looking at those houses?

VA loans can be assumed by civilians.
For example, I bought a million dollar house (that isn't the current max for a VA loan but the numbers don't matter) and I have a great rate and want to let the next buyer assume it. If that person also has eligibility, they can take that over and use their own eligibility. If they do not, I can let them assume my loan but I also give up my eligibility meaning that if I want to get another VA loan for my next house purchase, I likely can't (or don't have the full amount available to me).

If you let a non-VA eligible person assume your VA loan, you can’t take another VA loan until the first loan is closed. VA loans are cheaper and require 0 down payment.

Also, if you let a non-VA eligible person assume your VA loan and they default, your VA eligibility is gone forever.

That’s why VA-loan holders look for other VA-eligibles: they can “swap” their eligibility on the loan.