How to Buy a Condo Unit in California with a VA Mortgage Loan

VA loans allow military members and veterans to buy a home in California with no money down, a major advantage in a pricey real estate market like ours.

This program also allows you to purchase a variety of property types, including traditional single-family homes, townhomes and condo units.

But there are some specific rules for buying a condo in California through the VA loan program. The main caveat is that the entire condominium development must already be approved by the U.S. Department of Veterans Affairs.

Acceptable Property Types for a VA Loan

Many cities across the state of California are currently experiencing a housing market shortage. This means there aren’t enough homes on the market to satisfy the demand from buyers.

Because of this, military members and veterans who are searching for a home to buy might have to consider additional types of properties.

The good news is that the VA loan program allows for this. The Department of Veterans Affairs knows that buyers need access to a wide range of housing options. So they’ve built it into the program.

In California, you could use a VA loan to do any of the following:

• Buy a single-family home, townhouse, or multi-family up to 4 units
• Buy a condo in a VA-approved project
• Buy a home and improve it
• Buy a manufactured home and lot

By considering various types of properties (and by expanding your search zone to include additional communities), you’ll have a better chance of finding a home to buy.

Rules for Buying a Condo With a VA Loan

In order to buy a condo in California with a VA-guaranteed mortgage loan, you’ll need to ensure that it’s part of an approved condominium project.

• If it has been approved by the VA already, you’re good to go.
• If it’s not approved, you would have to request a review from the VA or else find another condo to purchase.

Here’s how the Department of Veterans Affairs explains it in their buyer’s guide:

And here’s how to find approved condominium projects in your area:

1. Visit the following URL: https://lgy.va.gov/lgyhub/condo-report
2. Check the box that says “retrieve only approved condos”
3. Enter “California” in the state field along with your city or county
4. Click the “enter” or “submit” button to process your request

Once you’ve completed the above steps, you’ll receive a list of VA-approved condominium projects and developments in your chosen area. You could use a VA home loan to purchase a condo unit in any of those developments, as long as you’re eligible for the program.

If you have a specific condo project in mind, but it’s not on the approved list, your mortgage lender might be able to request a review from the VA. There’s a process in place for this.

But the easiest route is to choose a property that has already been approved by the Department of Veterans Affairs, since the review process can take some time.

Benefits of Buying a Condo vs. Detached Home

Statistically speaking, most home buyers in California gravitate toward traditional single-family detached homes. A “detached” home is a freestanding residential building that does not share any walls or common structural elements with neighboring houses.

With a condo, on the other hand, residents own individual units within a larger building or a community of buildings. The unit itself is a self-contained living space, while common areas and amenities are owned jointly by all owners within the development.

There are pros and cons to both of these choices (detached home vs. condominium). But since this is a guide to buying a condo with a VA loan, let’s focus on that:

The Pros of Buying a Condo

• Affordability: Condo units generally have a lower purchase price and property taxes compared to detached homes.
• Amenities: They often include shared amenities like pools, gyms, and security features.
• Convenience: Many condos are located in desirable urban areas with easy access to public transportation and amenities.
• Lower Maintenance: Exterior maintenance and repairs are typically covered by the homeowner association (HOA).

The Cons of Buying a Condo

• HOA Fees: Monthly fees for condos can be costly and cover maintenance, amenities, and reserves.
• Rules and Regulations: HOAs have rules that may restrict renovations, pets, rentals, and other activities.
• Less Privacy: Shared walls and common areas provide less privacy when compared to a regular detached home.
• Limited Control: As a condo owner, you’ll have less control over exterior appearance and shared spaces.
• Appreciation: In some markets, single-family detached homes tend to appreciate faster than condos.

You Could Finance 100% of the Purchase Price

Regardless of whether you buy a condo or a regular home in California, the VA loan program offers the same benefits. Among other things, it allows you to finance 100% of the purchase price.

This means you could buy a condo in California with no down payment.

You can also avoid paying mortgage insurance, which is typically required when a borrower makes a low down payment. This program essentially removes what is often the biggest obstacle to homeownership: the upfront expense.