How to utilize VA Loan wisely

[Muinda Gueston]

Recently qualified for 300k and relocating VA in Jan 2018. I want to purchase a multi fam home or duplex however nothing appealing is avail so far. Should I purchase nice single fam home and work on getting loan to purchase multi fam home later? I retire in 3.5 years and I want to have at least 2 rental properties under my belt by then. Thanks

[Adam L.]

Hello and welcome to BP! First off let me say I am not an expert at all; however, I have done a lot of reading and research and have a decent understanding of some of this stuff. But basically, take what I say with a grain of salt. :)

Depending on where you move in VA you may struggle finding a move in ready MF property for that price so you may either need to put some of your own capital in there (if that is an option) or do something like an FHA 203k loan to start. I say the FHA loan strictly because you can take the loan amount and a rehab amount into the same loan. If you do it this way you can buy a MFR that needs some work (which you cant do with a VA loan in most cases) and then use the loan to pay for the rehab as well. When you finish with that you can then try and refinance with a VA loan and pull some equity out to do it again. With the FHA loan you will not need a really large down payment either so that is a plus!

If you really want to get the MFR I would advise against getting the single family as that will only slow you down and potentially stop you (depending on the timing and other things) from using the VA loan on the MFR. I hope this helps!