Pre-Foreclosure with VA Loan

[Harrison Lewis]

What's up BP! 

Really excited to be here. I am pretty new to the REI space and have been soaking in as much information as possible. I've been reading Brandon Turner's Rental Property Investing Book and have enjoyed learning so far (time to take action). I currently live in the Tacoma, Wa area and own a townhouse here, purchased in 2020. It was my first purchase and at the start of covid, its appreciated quite a bit since and I am looking to purchase again using my VA entitlement.

Has anyone ever purchased a pre-foreclosure with the use of a VA Loan? I want to figure out how I can purchase a pre-foreclosure I found with a $336k mortgage balance. I would be curious if taking over the mortgage is possible, which means I could have a much lower rate. Ideally I would turn around and rent the townhouse, acquire private money to rehab the 2nd purchase, refinance it and do it again, potentially doing a HELOC on the townhouse for additional buying/rehab power.

Are lenders generally open to pre-foreclosures or is it mainly done with private funding? Any advice is greatly appreciated. 

[Sherief Elbassuoni]

@Harrison Lewis, you can buy pre-foreclosure properties with VA loan. That said, you will need to live in the property (or house hack it) and it can not be a pure investment property.