VA Loan with tenant in place

[Jake Kain]

Hi BP!

My wife and I are a week away from closing on our SFR! We have been looking for the next place for months and have yet to find something that works for us. We have set our sights on a cheaper townhome in the Tempe area next to ASU. It is a downsize for us but allows us to keep our expenses close to where they are at in our SFR. We will likely be there for a couple years and then resell or keep it as a rental, whichever makes sense when the time comes.

However, there is currently a tenant in place until the end of July. We plan on using a VA loan, and I know that means we have to have to intent to occupy, which we definitely do. However, if I remember correctly the VA wishes you occupy within 60 days and obviously the tenant will be there closer to 120. If I show the VA proof of the lease in place, will they allow this extension? If not, I will look for alternative solutions. Thanks!

[Ryan Swan]

@Jake Kain I don't think underwriting will let you close unless you can conclusively prove that you will be occupying the property within 60 days of COE. 

Couple options:

1) Have seller offer tenants an incentive to move out early (in writing)

2) Move your close date to sometime around Mid June. That will give you time to properly notify the current tenants that you will not be renewing their lease and that they need to vacate by July 31.