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Started By
Message
Interesting financial question for my military folks
Posted on 11/14/25 at 9:54 pm
Posted on 11/14/25 at 9:54 pm
I have my house for sale. 900K VA loan with 2.25% fixed rate. If someone buys my house with their own VA eligibility, the loan can be transferred to them, I get my eligibility back.
I am being told that I can transfer my loan to someone who doesn't have VA eligibility, but then mine would forever stay tied to this house until they sold it or paid it off & died.
The question is, how would that value be calculated? 1% in rate = 1 point (1 percent of loan amt). Current non VA rates are about 5.5%, so the difference is about 3.25% of 900k. That's about 29K, but I would be losing out on the ability to get into my next home with $0 down and have to put up 20% to not have PMI. Additionally, I'd have to pay to refi later.
1. is it worth it to let someone keep my VA eligibility tied up?
2. what is it worth to them? They would be saving about $700K over the life of the loan.
*The buyer would be paying $5930 vs $4700 monthly; saving $1230 / month & pay his remaining mtg off 55 months early.
Has anyone heard or done this?
I am being told that I can transfer my loan to someone who doesn't have VA eligibility, but then mine would forever stay tied to this house until they sold it or paid it off & died.
The question is, how would that value be calculated? 1% in rate = 1 point (1 percent of loan amt). Current non VA rates are about 5.5%, so the difference is about 3.25% of 900k. That's about 29K, but I would be losing out on the ability to get into my next home with $0 down and have to put up 20% to not have PMI. Additionally, I'd have to pay to refi later.
1. is it worth it to let someone keep my VA eligibility tied up?
2. what is it worth to them? They would be saving about $700K over the life of the loan.
*The buyer would be paying $5930 vs $4700 monthly; saving $1230 / month & pay his remaining mtg off 55 months early.
Has anyone heard or done this?
This post was edited on 11/14/25 at 10:09 pm
6
Posted on 11/15/25 at 5:11 am to oneg8rh8r
Heard of
Never heard anyone actually do it
To me, that savings is worth a shite ton and I would need to be in a tight spot to do it
But if you have the perfect situation, and can get an extra 50k out of it, go for it
Never heard anyone actually do it
To me, that savings is worth a shite ton and I would need to be in a tight spot to do it
But if you have the perfect situation, and can get an extra 50k out of it, go for it
Posted on 11/15/25 at 6:25 am to oneg8rh8r
I don't think I'd ever sell a home with a 2.25% interest rate. Or at least I'd be hard pressed to do so. If I did sell it, 0% chance I'm letting my VA eligibility get tied up
Posted on 11/15/25 at 6:38 am to oneg8rh8r
wasn't there a proposal for you to be able to roll your current low interest low into a new home?
Posted on 11/15/25 at 1:03 pm to C
Posted on 11/15/25 at 5:28 pm to oneg8rh8r
Not exactly your question but would you have enough remaining eligibility to cover 25% of next purchase? From what I'm reading that's all you may need for another VA loan rather than the entire purchase price.
The low rate assumption has a value for buyer but they still need to come up w cash to buy you out of your equity position or get a second mortgage which I'd assume is higher rate than a first. May be a niche buyer you're looking for. Is it listed on sites for assumable loans where such buyers are likely shopping? ETA: not showing up on ROAM or ASSUMABLE
The low rate assumption has a value for buyer but they still need to come up w cash to buy you out of your equity position or get a second mortgage which I'd assume is higher rate than a first. May be a niche buyer you're looking for. Is it listed on sites for assumable loans where such buyers are likely shopping? ETA: not showing up on ROAM or ASSUMABLE
This post was edited on 11/15/25 at 5:41 pm
Posted on 11/15/25 at 10:32 pm to TorchtheFlyingTiger
There are people in Seattle area that wouldn't think twice about 5M on a second, vacation home.
Posted on 11/16/25 at 1:39 pm to oneg8rh8r
I have no idea how you afforded that house. Are you a general that's been stationed at JBLM since the early 2000s?
Posted on 11/16/25 at 2:57 pm to oneg8rh8r
There’s 900k left Op? Doesn’t the buyer have to qualify for a 900k VA loan? Not sure how easy that will be.
The simple way to do it would be to build it into the purchase price of the home. It’s arguably worth 3% lnterest or whatever math you want to work out in the purchase price to someone that would qualify.
The 2nd question is do you need the VA option for your next purchase? I’d hope not but if you do then this isn’t even a question.
Posted on 11/16/25 at 7:37 pm to PetroBabich
Zillow shows last sale for $540k in 2017, easily affordable on a military retirement and defense contractor salary. Guessing OP took opportunity to cash out refinance when rates were low about 4.5 yrs ago (55 months).
Posted on 11/16/25 at 9:33 pm to TorchtheFlyingTiger
I guess if you retired as an O5 or O6 and immediately got a 6 figure contracting job. Either way the house is beautiful and good for the OP on the investment.
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