Can I Keep My Current Home as a Rental and Buy Another Home with My VA Loan?

 


One of the best features of the VA Home Loan benefit is its flexibility. A common question I get from Veterans and Active Duty families is:

"If I already have a VA Loan on my current home, can I keep that house as a rental and still use my VA Loan to buy another home?”

The short answer is: Yes, rarely is the answer no.

How It Works: VA Entitlement

The VA guarantees loans using something called entitlement. Every Veteran or eligible service member has a basic and a bonus entitlement. Together, these benefits usually cover enough for most borrowers to purchase well over $700,000 in many markets without a down payment.

If you’ve already used part of your entitlement on your current home, you may still have remaining entitlement available. That’s what allows you to buy another primary residence while keeping the first as a rental.

Key Requirements to Know

  1. Primary Residence Rule – The new home you purchase with a VA Loan must be your primary residence. You can’t use a VA Loan to buy a vacation home or purely an investment property.

  2. Occupancy Timeline – You generally need to move into the new home within 60 days of closing (exceptions apply for deployments or PCS orders).

  3. Rental Income – If you plan to rent out your current VA-financed home, some lenders may allow you to use part of that rental income to offset your debt-to-income ratio.

  4. Funding Fee – If you’re using your VA Loan a second time, a funding fee may apply unless you qualify for a waiver (such as having a service-connected disability).

Example Scenario

A Veteran owns a home in Texas with a VA Loan but gets PCS orders to Florida. Instead of selling, they decide to rent out the Texas home. Because they still have entitlement remaining, they can purchase a new home in Florida with another VA Loan—zero down payment required.

Why This Matters

  • Build wealth through real estate investing while still living in your dream home.

  • Keep flexibility for military families who move often.

  • Maximize your VA benefits—you earned them.

Bottom line: Yes, you can keep your current home as a rental and still use your VA Loan for another purchase, as long as you meet the entitlement and occupancy requirements.

If you’re a Veteran or Active Duty service member considering this move, I’d love to run the numbers with you and explore your options.

About Between Two Doors

Between Two Doors is a podcast where I talk with Realtors about their journey, aiming to connect home buyers and sellers with agents on a more personal level. I ask "right brain" questions that go beyond transactions, focusing on the experiences, values, and passions that make these professionals great at what they do.

Listen to more episodes at: https://www.betweentwodoors.com

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