Watch the video about this topic: https://www.youtube.com/@simplydoit1

🎯 What This Blog Post is About:

This blog post explains how VA Loan Assumption works as a creative financing strategy for real estate investors. It’s part 3 of Dani Beit-Or’s “Creative Deals” series and dives into how assuming an existing VA loan can offer low interest rates, lower purchase costs, and strong cash flow potential—if you can navigate the complexities.

⏱️ Estimated Reading Time: 6–7 minutes

🔑 Key Takeaways:

• VA Loan Assumption allows investors to take over an existing low-interest VA loan
• Unlike “subject-to” deals, VA loan assumptions require lender approval
• Benefits include lower mortgage rates, better cash flow, and reduced closing costs
• Challenges include long approval time, large down payments, and seller cooperation
• Dani shares a real-life deal-in-progress, including leaseback terms and current hurdles

In part 3 of Dani Beit-Or’s Creative Deals Series, we go deep into VA Loan Assumption—a powerful but complex strategy that can help investors lock in low interest rates and stable cash flow while navigating a shifting real estate market.

✅ What Is a VA Loan Assumption?

A VA loan is a mortgage backed by the U.S. Department of Veterans Affairs, typically offered to eligible military veterans. These loans often have great terms, like low interest rates and minimal down payments.

A VA loan assumption lets someone else (like Dani or you) take over that VA loan, keeping the same rate and terms. Unlike a “subject-to” deal where the lender is unaware, VA loan assumptions are official—you must qualify and be approved by the lender who issued the original mortgage.

🔍 Example: Dani is currently under contract on a VA loan deal with a 3.5% interest rate and 27 years remaining. Once approved, he’ll take over that loan—and the seller will rent the home back for 9 months, creating instant cash flow.

💡 Benefits of a VA Loan Assumption

1. Low Interest Rate
   Dani is locking in a rate under 4%—something rarely available in today’s market.
2. Strong Cash Flow
   Paired with a leaseback from the seller, Dani secures rental income from day one.
3. Lower Closing Costs
   No need for a new mortgage means fewer fees.
4. Good Property Terms
   Even if the equity isn’t massive, the strong location and large house make it a solid investment.

⚠️ Challenges to Expect

• Lender Approval Required
  This isn’t automatic. You’ll go through full underwriting and paperwork like a new loan. Expect 60–90+ days of waiting.
• Big Down Payment Gaps
  If the house is worth $300K but the VA loan balance is $100K, you’ll need to bring $200K to close. That limits who can take advantage.
• Finding the Right Deal is HARD
  Dani reviewed over 60–100 deals to find just a few worth pursuing. Most don’t meet all the criteria.
• Sellers May Be Difficult
  Many don’t understand VA assumptions or aren’t willing to wait months for approval.

🧠 Common Misconceptions

• “Only Veterans Can Assume VA Loans”
  ❌ Not true! Civilians and investors can assume VA loans.
  ✅ Only other veterans are restricted from assuming another veteran’s loan.

📝 Real Deal Example from Dani

Dani is currently working on a property with a VA loan. He negotiated:

• A market-rate leaseback for 9 months
• A 3.5% mortgage rate locked in
• Positive monthly cash flow even after expenses

He’s still going through the VA lender’s approval process—and it’s taking time—but the deal structure is already favorable.

🎯 Final Thoughts

VA loan assumptions can be a great tool, especially in today’s high-rate environment. But they’re not for everyone. It takes patience, creative structuring, and deep deal analysis.

Dani’s advice? Be prepared for hard work. But when a VA assumption deal comes together, it can be one of the best long-term investment strategies out there.

📺 Missed the First Two Posts in the Series?

• Part 1: Subject-To Deals
• Part 2: Leaseback & Option-to-Buy Strategies

📢 Stay tuned for Part 4 & 5—more creative strategies ahead!