Eligble VA Property Types:
What You Can & Can’t Buy
With A VA Loan

Eligible VA Property Types: What You Can & Can’t Buy With A VA Loan

If you’re using your VA eligibility to purchase a home, VA has guidelines regarding the type of property you can buy. Eligible property types are set forth below:

  • Single Family Residence
  • Condominiums (must be in a VA approved complex)
  • Townhomes (must be in a VA approved complex)
  • Manufactured & Modular Homes: Manufactured and modular homes must be sold along with the land and placed on a permanent foundation. Although VA guarantees loans on manufactured and modular homes, many lenders do not fund these types of loans. (Remember, VA does not make loans, but rather guarantees loans. Loans are made by VA Approved mortgage lenders. Many VA lenders do not make all types of VA loans). Some manufactured and modular home loans are only available on a state-by-state basis. Sidwell Mortgage can fund a VA loan on a manufactured or modular home in the state of California. Some restrictions apply.
  • Homes located on a farm: A servicemember may use a VA loan to purchase a home located on farm property, but not just land used for farming. A home must be included in the purchase. The VA loan is not for the farm land, but for the habitable, primary residence located on the land.
  • Multifamily One to Four Unit Structures: One to four multi-family units can be purchased with a VA loan, but at least one of the units has to be used as the borrower’s primary residence. The units must be in a VA approved development or must receive approval from VA.
  • New Construction: Although a VA home loan can be used to buy a brand new home, it’s often difficult to receive VA approval for these types of properties. This is largely due to VA guidelines that require pre-approval of builders, plans and building sites, along with a series of inspections and a one year home warranty. Purchasing a new home from a developer eliminates much of the red tape.

The Property Types VA Does NOT Allow

  • A VA loan cannot be used to purchase an investment home. The servicemember must intend to occupy the property as their primary residence.
  • VA loans cannot be used for purposes other than purchasing residential properties. The VA loan is not a business loan and cannot be used for storefronts or office spaces.
  • Purchases of unimproved bare land (land that does not include an owner-occupied primary residence for the borrower) is not permitted.
  • VA loans cannot be used to purchase homes that are not located within the U.S and U.S. territories.
  • Co-ops are not currently eligible for VA loans. VA suspended financing for these type of shared-ownership properties in December 2011 (to date the program has not renewed).

Until the next post … may health and happiness abound!


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