Howdy,

We recently sold our home in Spring, TX. We couldn't decide whether to buy or rent and would often go back and forth the same day. We ended up renting with a one year lease in The Woodlands, somewhat close to my daughter's charter school.

We now have 10 months left on our lease, and we fully intend to purchase a primary residence home using my VA loan at or near the end of our rental lease.

My question is, can I/should I purchase an investment property in the mean time using a traditional mortgage (I have the 20% down from the sale of the previous home)? If so, would that affect my ability to get a VA loan for my primary residence?

I recognize I'm sort of doing it backwards here, but we can't buy the primary home using VA and be living in it within two months without breaking the lease so that won't happen for another 6+ months or so. I'd like to get started on investment income sooner rather than later, especially if we can find a good deal that's in a much larger expanded footprint than where we are looking for our primary home.

Thanks in advance for your input and suggestions.

Should be no problem. I would go with 25% down on the IP.

Also you can save around 50% of the VA funding fee with 5% down so consider that as well.

Thanks, Steve. I'm actually exempt from the funding fee due to service-connected disability, so I can save an additional 5% on the VA loan.

I just have a hard time believing the VA won't come back and say "well, you already have a traditional loan on this house, why do you need a VA loan on another house?"

Well I can double check with my lender but should be fine.

I'd put as little down as possible. Money is stupid cheap. Lever up.

SteveBott said:

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Funding fee on repeat VA over 3.6 of the loan. 5 down cuts it to 1.6.


So 5% down on a 300k loan saves 6 grand.

I do this for a living.

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Listen to Steve.

SteveBott said:

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Funding fee on repeat VA over 3.6 of the loan. 5 down cuts it to 1.6.


So 5% down on a 300k loan saves 6 grand.

I do this for a living.

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Its actually 1.65 %


And the VA is perfectly fine with you owning investment properties

Why 25% if he can put down less than that on IP?

Will the IP be VA also?

Can you buy something (iP or PR) with less than 5% down?

There is a conforming charge of discount points on IP. They cost increases 1.25% in points from 75 to 80. Not a goood ROI to get 5% more loan for 1.25 points.

You cannot buy IP with VA. Must be a primary residence. You can convert a VA to IP at some point

VA offers 100% financing
Conventional has 3 down but 5 is better
Fha is 3.5 down

SteveBott said:

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There is a conforming charge of discount points on IP. They cost increases 1.25% in points from 75 to 80. Not a goood ROI to get 5% more loan for 1.25 points.

You cannot buy IP with VA. Must be a primary residence. You can convert a VA to IP at some point

VA offers 100% financing
Conventional has 3 down but 5 is better
Fha is 3.5 down

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Sounds like it would be a good idea to meet up with SteveBott and have him guide you through this process

Got it. Thanks. 25 to 20 makes sense. But 25 to 3-5? 1.25 point for 20%?