VA Friyay: Unlocking the Secret of Having Multiple VA Loans

Building a Real Estate Portfolio with Your VA Home Loan

Hey everyone, welcome to VA Friday! Today, we're revisiting a topic I've covered before: how to build a real estate portfolio using your VA home loan. A lot of people don’t realize that this is possible, so I want to break it down for you in a clear, updated way.

But before we dive in, let’s start with a quick dad joke:

What kind of car does Jesus drive? A Christ- ler! Get it? Alright, let’s jump in!

Using Your VA Loan to Build a Rental Portfolio

If you’ve heard my story, you know that you can use your VA loan multiple times and even have multiple VA loans simultaneously. The key is understanding the rules and how to work within them to maximize your benefits.

Essentially, you can buy a home, then later turn it into a rental and buy another home with your VA loan—repeating this process to build a rental portfolio. Here’s how it works:

1. Buy Your First Home – You use your VA loan to purchase a home and live in it for at least a year (the VA doesn’t specify a required time, but 12 months is recommended).

2. Convert It to a Rental – Once you’ve lived in the home for the recommended time, you can rent it out. You don’t need to refinance or take any additional financial steps.

3. Buy Another Home with Your VA Loan – You can purchase another home using your remaining VA loan entitlement while keeping the first home as a rental.

Understanding VA Loan Entitlement & County Loan Limits

Your ability to buy another home with a VA loan depends on the county loan limit where you’re purchasing and how much entitlement you have left. Let’s walk through an example:

• Scenario: You bought a home in Bremerton, WA for $250,000 with your VA loan. Now, you’re moving to Honolulu, HI and want to keep your Bremerton home as a rental.

• The county loan limit in Honolulu, HI is about $1,209,750.

• To determine how much entitlement you have left, subtract your original home’s purchase price from the new county loan limit.

• This means you could purchase a home in Honolulu for around $960,000 with zero down.

If you were moving to a location with a lower county loan limit (e.g., Georgia at $806,500), your zero-down purchasing power would be around $550,000.

Financial Considerations

When keeping a VA-financed home as a rental, here are key things to consider:

• Three Months of Reserves: You must have at least three months’ worth of mortgage payments in savings for each property after closing.

• Rental Income Offsets: Depending on the lender, you may not need a signed lease to offset the mortgage on your rental property, allowing you to maximize your purchasing power.

Buying Above Your Entitlement Limit

If you want to purchase a home above your remaining VA entitlement, you’ll need a down payment. Here’s how to calculate it:

• Subtract your entitlement from the new home’s purchase price.

• Your down payment is 25% of the difference.

For example, if you want to buy a $975,000 home in Honolulu but only have $960,000 left in entitlement, the difference is $15,000. You would need to put down 25% of $15,000, which is $3,750—a far better deal than a conventional 10-20% down payment!

Restoring Your VA Entitlement

Once you’ve maxed out your VA loan benefits, there are two ways to restore your entitlement:

1. Sell a Property – Selling a home that used VA financing fully restores the entitlement tied to that property.

2. One-Time Restoration – This allows you to restore your entitlement once without selling. However, you must refinance the VA loan into a conventional mortgage with at least 25% equity in the home. This option should be a last resort since conventional loan rates are typically higher than VA rates.

   1. NOTE: The refinance from a VA loan to a non-VA loan will not restore your entitlement. At least, it's not supposed to.

The West Coast vs. Midwest Strategy

• West Coast Strategy: Home prices are higher, making it difficult to hold multiple properties with VA loans. Investors in these markets often play an equity game—buying, holding, selling, and reinvesting profits.

• Midwest/South Strategy: Home prices are lower, allowing investors to purchase multiple properties before reaching their VA loan limit. This strategy focuses on cash flow accumulation over time.

Military Couples: Doubling Your VA Power

If both you and your spouse are eligible for VA loans, you can alternate who purchases each home, effectively doubling your portfolio-building potential. Some military couples I’ve worked with have built portfolios of 6-7 homes using this method!

Long-Term Strategy: Equity vs. Cash Flow

Real estate investing with a VA loan isn’t just about holding properties—it’s about

maximizing value:

• If you focus on equity growth, you may buy, hold, and sell strategically to fund bigger investments (e.g., apartment buildings or commercial real estate).

• If you focus on cash flow, you may prioritize keeping properties for rental income, ensuring each property generates at least $100-$200 in monthly profit after expenses.

Final Thoughts

Yes, you can have multiple VA loans at the same time. It’s all about understanding:

1. Where you’re buying (county loan limits matter!).

2. How much entitlement you’ve used and have left.

3. Whether the rental income makes sense.

4. Your long-term investment strategy—equity growth vs. cash flow.

If real estate investing is something you're interested in, take the time to learn the rules, strategize, and build a strong team to guide you through the process. Whether you're looking to build a cash flow portfolio or play the equity game, your VA home loan is an incredible tool to help you reach your goals.

Want to learn more? Check out my blog on my duplex and commercial property investment journey (Part 3 of my story). Until next VA Friday, happy investing!