Buying a home with the VA loan

**mikesierra** · 02-13-2008, 12:30 PM

Hi everyone. I'm currently a student attending California State University San Bernardino. I commute more than 45 miles one way to school every day. I don't particularly like it, because it leaves me with little access to the school's resources such as tutoring. I have considered moving closer to my school but this poses a sort of dilemma. I will probably end up transferring to a different school at some point because this one does not offer any engineering courses, which I would like to explore. Because of this, I have been reluctant in signing any sort of lease, which is usually at least 9 months, although some might be found for 6, at a much higher rate. School housing requires that you sign a 9 month contract. The other factor that leaves me reluctant is that I don't particularly like the area.

I have entertained the idea of purchasing property (house or condo) with the VA loan in San Diego and attending school there instead. Part of the problem is that I am not well informed in this sort of business. How does property tax apply (or any similar downfalls) and is it a significant burden? I would imagine that highly desirable places like San Diego must have disadvantages to purchasing property there.

The latter part of my question is whether my proposal makes sense. Apparently, San Diego is a good buyer's market right now, so it would be easier to find more affordable housing. As a student, however, I could not make the payments on my own. The idea that I have would be to purchase a property with 3+ bedrooms and rent the other rooms out to college students, which, as I have been informed, is not hard to do. If you look on craigslist you can see that affordable rent for college students is in high demand, especially in large academic communities. Renting out the rooms will allow me to afford the payments, and I can sell the property once the market speeds up again. I would be able to hold the property for a significant amount of time if needed. My question is whether this is a viable plan.

Thanks for your help.

**carlam** · 02-14-2008, 02:35 AM

It all sounds very good on paper.... However, if you can not afford a mortgage payment on your own, chances of your qualifying for a mortgage is not very good.

Also, being a landlord for college students isn't exactly a landlord's dream client. Think "Animal House" and when you move on, students would most likely be your only rental pool. And when the time came to sell it because you are tired of this role; you probably wouldn't gain a lot on the back end, because a college student would be your buyer.

Find someone else to be the landlord and enjoy being in college.

**mikesierra** · 02-14-2008, 02:58 AM

It all sounds very good on paper.... However, if you can not afford a mortgage payment on your own, chances of your qualifying for a mortgage is not very good.

Oh I thought the VA loan was guaranteed...

Also, being a landlord for college students isn't exactly a landlord's dream client. Think "Animal House"

Well I don't really have a problem with that. I've lived in a barracks for the past 3 years (about). It doesn't get much crazier than that. Clean and drug-free are my only concerts.

when you move on, students would most likely be your only rental pool.

Why is that?

And when the time came to sell it because you are tired of this role; you probably wouldn't gain a lot on the back end, because a college student would be your buyer.

I think I see what you're saying, but my proposal was in San Diego. I don't think selling a home in San Diego, or most anywhere in Southern California, would be limited to a market of students. Am I wrong on this? Most of the academic communities here are a mixed variety, especially in a metropolitan area like San Diego, right?

**carlam** · 02-14-2008, 04:48 AM

I was speaking in general you may not wish to buy in a university setting where the majority of renters and buyers would be attached to the university in some respect.

The VA garanty isn't quite what I think you are thinking. Do you have a VA certificate? You still need to be qualified for a loan, and there are guidelines on the condition of the home for the home to be qualified.

I am qualified to receive a VA loan, I haven't used it for a long time and know criteria has changed since I last used it.

Also, there is some confusion among realtors and sellers on the VA process and makes sellers uncomfortable. If you do go forward with this, contact an agent that has worked with VAs recently.

Here: http://www.homeloans.va.gov/pdf/final%20report.pdf