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Lesson 5.7

Occupancy Requirements

Samantha Reeves | Real Estate Expert

Primary Residences

Like the other government-backed loans, VA home loans have occupancy requirements that help keep the program’s focus on primary residences.

Service members who secure a VA purchase loan have to certify that they intend to personally occupy the property as their primary residence. VA borrowers usually have a 60-day window after completing the loan process to move into the house. Requirements can differ on VA refinance loans.

Some homebuyers find that two months isn’t enough time. The VA does allow buyers in certain situations to go beyond that 60-day mark, although occupancy delayed more than a year is generally unacceptable.

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Occupancy Scenarios

Here are a few common situations and possible outcomes:

  • Active duty borrower
    Your spouse can fulfill the occupancy requirement. Lenders will typically take your travel and living expenses into account when evaluating your finances. That means including those costs into your DTI ratio and residual income calculations.
  • Married civilian borrower working overseas
    A spouse can often fulfill the occupancy requirement in these situations. Lenders will consider your travel and living expenses.
  • Single civilian working overseas
    This can be more challenging and depends on a number of factors. You may need to show that you’ll be home significant portions of the year and have ties to the area. Lenders will consider travel and living expenses and likely want to verify who will care for the home in your absence.
  • Married civilian working in the U.S. and looking to purchase elsewhere in the country for family
    This can also be challenging. Borrowers may need to show that they’ll be occupying the new home sometime in the near future, or that they can’t live with their family for reasons beyond their control. Lenders will also consider your travel and living expenses.
  • Single civilian working in the U.S. but looking to purchase elsewhere in the country
    This scenario won’t generally be acceptable to the VA or lenders.

Every occupancy scenario is different, and requirements and policies can differ among lenders. If you think you might have difficulty occupying a home within 60 days of closing, let your loan officer know as soon as possible. Depending on your unique situation, there may be an exception or a workaround.