Are you a veteran, currently serving in the military, or a surviving spouse of a veteran? If so, you might be eligible for a VA loan. VA loans have many advantages over traditional mortgages, such as no down payment requirement and no private mortgage insurance. However, there are limits to the amount of acreage you can finance using a VA loan.
The Basics of VA Loans
Before we dive into VA loan acreage limits, let’s quickly review the basics of VA loans. VA loans are a type of mortgage backed by the Department of Veterans Affairs (VA). They’re designed to help veterans, active service members, and eligible surviving spouses buy homes.
One major advantage of a VA loan is that there’s no down payment requirement. This can be a huge benefit for those who don’t have a lot of cash on hand. Additionally, VA loans don’t require private mortgage insurance (PMI), which is typically required for conventional loans when the borrower doesn’t put down at least 20%.
Another benefit of a VA loan is that the VA sets limits on how much lenders can charge in closing costs. This can save borrowers thousands of dollars in closing costs.
Understanding VA Loan Acreage Limits
While VA loans can be a great option for buying a home, there are limits to what you can finance using a VA loan. One of those limits is acreage.
According to the VA, the maximum acreage that can be financed using a VA loan depends on the location of the property. In most cases, the maximum acreage is 10 acres. However, if the property is located in a rural area, the maximum acreage can be up to 20 acres.
It’s important to note that the VA is primarily concerned with the residential use of the property. So, if you’re buying a large piece of land with the intention of building a home on it, the VA will only finance the portion of the land that will be used for the home and any immediate surrounding area.
Additionally, if a property has multiple dwelling units (such as a duplex or triplex), the VA will only finance the portion of the land used for the primary residence.
VA Loan Acreage Limits by State
State |
Maximum Acreage (Urban) |
Maximum Acreage (Rural) |
|---|---|---|
Alabama |
5 |
12.5 |
Alaska |
5 |
20 |
Arizona |
2 |
10 |
Arkansas |
5 |
10 |
California |
2 |
10 |
Colorado |
5 |
35 |
Connecticut |
2 |
10 |
Delaware |
2 |
5 |
Florida |
2 |
5 |
Georgia |
5 |
10 |
These limits are subject to change, so be sure to check with your lender if you’re considering buying a property with acreage using a VA loan.
FAQs About VA Loan Acreage Limits
1. Can I use a VA loan to buy a farm?
No, VA loans are intended for residential properties, not farms or agricultural land. However, if the property has a residential home on it and the acreage is within the VA’s limits, you can use a VA loan to finance the purchase.
2. Can I use a VA loan to buy a vacation home with acreage?
No, VA loans are intended for primary residences, not vacation homes. Additionally, VA loans have limits on the amount of acreage that can be financed (see table above).
3. Can I exceed the VA’s acreage limits if I make a down payment?
No, the VA’s acreage limits are set regardless of the size of the down payment.
4. Are there any exceptions to the VA’s acreage limits?
There may be exceptions for properties that are used for farming or ranching, as long as the primary use of the property is residential. However, these exceptions are granted on a case-by-case basis and require approval from the VA.
5. Can I get a VA loan for a property with multiple dwellings?
Yes, but the VA will only finance the portion of the land that’s used for the primary residence.
6. Can I use a VA loan to buy a mobile home with acreage?
Yes, as long as the mobile home is affixed to a permanent foundation and the property is within the VA’s acreage limits.
7. Can I use a VA loan to buy an investment property with acreage?
No, VA loans are intended for primary residences only.
8. Can I use a VA loan to buy a condo with acreage?
Yes, as long as the condo is located on a tract of land that falls within the VA’s acreage limits.
9. How do I know if a property is located in a rural area?
The VA has a searchable database of rural properties on its website. You can also check with your lender to see if the property is considered rural.
10. Can I use a VA loan to buy a property outside of the United States?
No, VA loans are only available for properties located within the United States, its territories, and possessions.
11. Can I use a VA loan to buy a property with acreage if I’m not a veteran?
No, VA loans are only available to veterans, active service members, and eligible surviving spouses.
12. Can I use a VA loan to buy a property with acreage if I’ve used my VA loan entitlement in the past?
Yes, you can use your VA loan entitlement more than once as long as you’ve paid off the previous VA loan or sold the property that was financed with the previous VA loan.
13. Can I get a VA loan for a property that’s in need of repairs?
Yes, but the VA has specific requirements for the condition of the property. The property must be safe, sound, and sanitary, and any repairs required must not affect the safety, soundness, or structural integrity of the property. Additionally, the repairs must be completed before the loan can be approved.
Conclusion: Use VA Loans Wisely
Veterans and their families have made significant sacrifices for our country, and VA loans are one way that we can show our appreciation. However, it’s important to use VA loans wisely and understand the limitations that come with them.
If you’re considering buying a property with acreage using a VA loan, make sure you understand the VA’s acreage limits and any other requirements that may apply. And don’t forget to shop around and compare rates from multiple lenders to ensure you’re getting the best deal possible.
At the end of the day, a VA loan can be a great way to achieve the dream of homeownership, but it’s important to do your due diligence and make informed decisions.
Thank you for your service, and best of luck in your homebuying journey!
Closing Disclaimer: Consult with Experts
This article is intended for informational purposes only and should not be considered legal or financial advice. The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of any agency of the U.S. government.
If you’re considering a VA loan, it’s important to consult with a knowledgeable lender and a trusted real estate agent to ensure that you’re making the best decisions for your unique situation. Additionally, be sure to carefully review all loan documents before signing, and ask questions if anything is unclear.
Good luck, and thank you for your service!