Why I’m Not Using My VA Loan—Yet: A Veteran’s Strategy for Real Estate Investing
Restored Tudor-Style Home Watercolor
Watercolor of a Tudor-style fixer-upper featured in our blog on using VA loans strategically for real estate investment and home renovation planning.
When most veterans start house hunting, the VA home loan seems like a no-brainer. Zero down payment, no PMI, and competitive rates? It’s a powerful benefit—and one I’ve personally used before. But here’s the thing: sometimes, not using your VA loan upfront can actually be the smarter move.
That’s exactly the situation I’m in right now.
The Property: An Older Home with Potential
I’m currently looking to purchase a home in a quiet neighborhood, sitting on a large lot, full of character and charm—but it needs some TLC. Structurally, it’s sound. But it has cosmetic issues and minor updates that, while not alarming to me, would likely raise red flags during a VA home loan inspection.
VA appraisals are strict. They’re designed to protect the veteran, which is great in theory, but in practice, it means many older homes or fixer-uppers don’t make the cut.
The Strategy: Conventional Now, VA Later
Instead of forcing the house through a VA loan inspection and risking denial, I’m going with a conventional loan with a minimum down payment. Here’s why:
Flexibility in what repairs I can make and when.
Speed—conventional loans can sometimes close faster without the VA’s extra steps.
Control—I can tackle the renovations on my timeline and to my standards.
Once the renovations are complete and the home has appreciated in value, the real play begins:
I plan to refinance with a VA loan, pull out the equity I’ve built, and use that to help fund the next property.
Why This Works
This is a long-term strategy focused on growth, not just homeownership. Here’s what makes it effective:
VA loans can be used for refinances (Interest Rate Reduction Refinance Loan or a VA cash-out refinance).
Equity unlocks new options—I can either hold the home or sell and roll profits into a new property.
I preserve my VA benefit for a home that will pass inspection down the line or use it strategically.
A Word of Caution
This strategy isn't for everyone. It comes with risk, requires strong budgeting, and assumes you’re able to handle or finance renovations. But if you're a veteran looking to build wealth through real estate, thinking outside the box can put your benefits to work in more powerful ways.
Closing Thoughts
Being a veteran comes with unique advantages—but they don’t always have to be used in the most obvious ways. Sometimes, the best way to honor those benefits is to use them when the timing is right. That’s the approach I’m taking—and I’ll be documenting the entire journey under my renovation brand, Timber & Tactics.
If you're a veteran exploring real estate or wondering how to best use your VA benefits, drop a comment or connect—happy to share more of what I’ve learned the hard way.
