What If I Dont Meet The Minimum Service Requirements
You may still be able to get a COE if you were discharged for one of the reasons listed below.
You must have been discharged for one of these reasons:
- Hardship, or
- The convenience of the government , or
- Early out , or
- Reduction in force, or
- Certain medical conditions, or
- A service-connected disability
Eligibility Requirements For Va Home Loan Programs
Learn about VA home loan eligibility requirements for a VA direct or VA-backed loan. Find out how to apply for a Certificate of Eligibility to show your lender that you qualify based on your service history and duty status. Keep in mind that for a VA-backed home loan, youll also need to meet your lenders credit and income loan requirements to receive financing.
Va Loan Eligibility Is Earned
Most service members are told that they will be eligible for a VA loan if they stay in long enough. Generally, service requirements are as follows:
- 2 years for regular service members
- 6 years for Reservists and National Guard members
- 90 days active duty during wartime
- 181 days active duty during peacetime
Are You Eligible for Home Loan Benefits?
If you’re not sure if you meet these requirements, don’t worry! You may still be eligible for a VA loan.
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What Are Va Loan Eligibility Requirements
First of all, you need to make sure youre eligible for a VA loan. The government has service requirements for veterans or those on active duty, and also offers opportunities for certain military spouses to qualify for VA loans. You can get more information from the governments website, but the basic requirements include:
- Youre currently on active military duty, or youre a veteran who was honorably discharged and met the minimum service requirements.
- You served at least 90 consecutive active days during wartime or at least 181 consecutive days of active service during peacetime.
- Or, you served for more than six years in the National Guard or Selective Reserve.
If your spouse died in the line of duty, you may qualify for a VA loan.
In order to apply, you need to obtain a VA Certificate of Eligibility, or COE. Without this certificate, you wont be able to get your loan.
Obtain A Certificate Of Eligibility
Your first step to getting a VA loan is making sure you are eligible. Determining your eligibility is an essential exercise. VA home loans are intended to help those who have served in the U.S. military to buy a home. Others may qualify, too. The VA sets specific requirements about your service, discharge and disability, to qualify for a VA home loan.
Veterans Eligible for VA Loans
Did you serve during World War II, the Korean Conflict, the Vietnam Era or the Persian Gulf War? If the answer is yes, you are probably eligible for a VA loan and can obtain a COE. Your active duty period must have lasted at least 90 days, but you may still be eligible if you were discharged due to a service-connected disability.
What if you didn’t serve in any of these conflicts? If you served during peacetime, you’re eligible if you meet any of the following requirements:
What if you’re not a veteran because you’re still on active duty with the Army, Navy, Air Force or Marines? If you have already served 90 days of continuous active duty, you’re eligible for a VA loan, with one caveat. When an ending date is established for Persian Gulf War service, the VA will require a minimum of 181 days of continuous active duty for anyone without wartime service to be eligible for a VA loan.
Spouses of Veterans
You may be eligible for a VA loan if you are the spouse or surviving spouse of a:
How to Apply for a COE
Apply for a COE Online
Apply for a COE Through Your VA Lender
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Exemption From Funding Fees
Disabled veterans are exempted from the VA funding fee, so they dont have to pay the VA funding fee during closing. To qualify for the exemption, you must currently receive some form of disability benefits. Your level of disability is irrelevant.
This exemption can save veterans or their surviving spouse thousands of dollars. For example, if you buy a home worth $200,000, you might pay as much as $2,800 $7,200 in VA funding fees when you close. Disabled veterans can avoid this fee.
Your Va Loan Has Been Assumed By Another Veteran
Your entitlement can be restored if you sell your home to another VA home buyer. It is possible for them to use their entitlement to buy a home, freeing up your entitlement at the same time.
It can also be possible for a non-VA buyer to assume your loan. However, they must pay off the mortgage before your entitlement amount is restored.
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Veterans’ Group Life Insurance :
- Servicemember separating, retiring, or being released from Reserve or National Guard assignment and already covered by SGLI OR
- Change text of second bullet to: National Guard or Reserve member covered by part-time SGLI who incurred a disability or aggravated a pre-existing disability while performing inactive duty training or traveling to/from duty OR
- Member of the Individual Ready Reserve or Inactive National Guard
Va Mortgages Come In Many Varieties
A VA loan can have a fixed rate or an adjustable rate. In addition, you can use a VA loan to buy a house, condo, new-built home, manufactured home, duplex, or other types of properties.
Or, it can be used for refinancing your existing mortgage, making repairs or improvements to your home, or making your home more energy-efficient.
The choice is yours. A VA-approved lender can help you decide.
Best Va Loan Lenders Of January 2022
- Andrea Agostini
Highest in customer satisfaction for 8 consecutive years
Up to $2,500 in lender credits
A VA loan is a military benefit that doesnt require a down payment or mortgage insurance. However, your credit score and credit history may still affect whether a lender is willing to offer you a loan with zero down payment.
Our guide to the best VA loan lenders covers the type of loans available, a step-by-step guide to the application process, and the Veterans Affairs s service requirements.
How Do Va Loans Work
Basically, you fill out paperwork from the VA that verifies your eligibility for the program. You also receive whats known as your entitlement, which is the dollar amount guaranteed on each VA loan. Lenders might be willing to loan up to four times the amount of your entitlement.
With all of that in place, its possible to get a VA loan with no money down. VA loans also dont require private mortgage insurance , but you will pay a VA funding fee when you close, which will be a percentage of the loans total value. That fee helps keep the program running for future borrowers.
What Is A Certificate Of Eligibility
A COE is a document that shows your mortgage lender that youre eligible for a VA home loan. To get a COE, you need to demonstrate proof of service. The proof you need to submit varies based on whether youre an active-duty military member, a veteran, a surviving spouse, etc.
If youre eligible, Rocket Mortgage® can help you secure your COE.
Va Loan Certificate Of Eligibility
Once you determine that you are eligible, the next step is to apply for your Certificate of Eligibility. The COE or Certificate of Eligibility is your golden ticket to getting a VA home loan. This certificate is needed by the lender to prove you meet the minimum service requirements for VA loan eligibility. You will need certain documents in order to apply for your COE, and those documents depend on your military category. You are not able to get a VA home loan without this certificate. The good news is its not to hard to find out if you are eligible. You can call 956-4040 to speak with a licensed VA home loan officer or you can visit the ebenifits protol here. www.ebenefits.va.gov
Veterans and Current/Former National Guard/Reserve members activated for service need their DD Form 214, including what service category they were and the reason for their separation of service.
Active duty service members and current National Guard/Reserve members not activated for service
need a current statement of service signed by their adjutant, personnel office or commander of the unit or headquarters. It must list the following items:
- Your full name
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How Many Times Can You Use A Va Loan
If youve used a VA loan to purchase a home in the past, you know what great benefits they have: low interest rates, no mortgage insurance, and, perhaps most importantly, no down payment. Local and state authorities often even offer property tax exemptions to qualifying veterans.
If youre planning to buy a new home soon and youve already used a VA loan for a previous home purchase, you might be wondering if you can take out another VA loan. Is there a limit on how many times you can use a VA loan?
Verifying Your Va Loan Eligibility Status
Lenders need what’s known as a Certificate of Eligibility to verify if a Veteran meets the minimum service requirements. Your COE provides the lender with confirmation that you qualify for VA loan benefits.
For most Veterans, this is an easy step. Your lender can typically pull your COE with only your social security number and date of birth.
In some cases, the process may be more complex. However, the important piece is you don’t need this document before applying for a VA loan.
Speak with a Home Loan Specialist to get your COE today. The process typically takes minutes to complete and ensures your home financing moves forward without delays.
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Native American Direct Loan
Helping Native Americans buy, build, improve or refinance homes on federal trust land is the goal of the Native American Veteran Direct Loan program. The program is available to members of certain Native American tribes and their spouses, as well as Alaska Native corporations and residents of Pacific Island territories.
To get started, confirm that your native community participates in the NADL program, apply for a VA certificate of eligibility and contact the VA regional loan center for your state.
About the authors:Hal Bundrick is a personal finance writer and a NerdWallet authority in money matters. He is a certified financial planner and former financial advisor. Read more
Barbara Marquand writes about mortgages, homebuying and homeownership.Read more
Buying A Home Use A Va Purchase Loan
VA purchase loans allow borrowers to purchase a new home without paying a down payment or Private Mortgage Insurance .
To qualify for a VA purchase loan, all of the following conditions must be met.
- You must prove your eligibility and obtain a Certificate of Eligibility .
- You must meet the lenders financial requirements.
- You must select a property that meets all of the MPRs defined by the department.
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Va Residual Income Rules
VA underwriters perform additional calculations that can affect your mortgage approval.
Factoring in your estimated monthly utilities, your estimated taxes on income, and the area of the country in which you live, the VA arrives at a figure which represents your true costs of living.
It then subtracts that figure from your income to find your residual income .
Think of the residual income calculation as a real-world simulation of your living expenses.
It is the VAs best effort to ensure that military families have a stress-free homeownership experience.
Here is an example of how residual income works, assuming a family of four which is purchasing a 2,000 square-foot home on a $5,000 monthly income.
- Future house payment, plus other debt payments: $2,500
- Monthly estimated income taxes: $1,000
- Monthly estimated utilities at $0.14 per square foot: $280
This leaves a residual income calculation of $1,220.
Now, compare that residual income to VA residual income requirements for a family of four:
- Northeast Region: $1,025
- South Region: $1,003
- West Region: $1,117
The borrower in our example exceeds VAs residual income standards in all parts of the country.
Therefore, despite the borrowers debt-to-income ratio of 50%, the borrower could get approved for a VA loan.
How Do I Apply For My Coe
Ready to apply for your VA COE? Here are the steps youll need to take:
For the VA COE application process to go smoothly, youll want to confirm your eligibility ahead of time. Lets explore the application requirements below.
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What Are The Rules For Down Payment Mortgage Insurance And Other Fees
VA loans do not require you to put down any money to obtain a loan, and dont require you to pay mortgage insurance. However, youll owe a funding fee, with the amount based on
- Whether youre in the military, are in the national guard, are a qualifying spouse, or are a veteran of the military or national guard
- The amount of your own down payment, if any
- The type of loan
- Whether youre a first-time borrower or youve had a past VA loan
Funding fees vary depending on whether youre buying or refinancing and other factors. This funding fees table on the VA website will help you figure out what youll owe.
Surviving spouses of deceased veterans who died because of their service dont have to pay a funding fee, nor do certain eligible veterans entitled to compensation for service-connected disabilities. When owed, the funding fee can be paid upfront or financed.
Lenders may also charge additional fees, including any of the following:
- Discount points to reduce your interest rate
- Loan origination fees
Fees and costs vary by lender.
How Can I Apply For A Va Loan
To apply for a VA loan, you should first find a VA-approved lender, like Rocket Mortgage®. Once youve found a lender, they can typically help you obtain your COE and get prequalified or preapproved for your loan amount. After that, your lender will guide you through the rest of the process, like getting your VA Appraisal and taking care of other requirements that need to be addressed before closing.
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Do Family Members Qualify For Va Loans
If youre a surviving spouse of a military member who was killed, injured or captured in the line of duty, you may also be eligible for VA-backed financing. To secure a VA loan as a surviving spouse, youll need to meet a few additional requirements:
- You have not remarried.
- Your spouse was killed in service or from a service-related disability.
- Your spouse was missing in action or a prisoner of war for at least 90 days.
- Your spouse was rated disabled and was eligible for disability compensation at the time of death.
There is always a possibility for exceptions to these requirements based on your exact circumstances and service history. Again, if you have additional questions about your specific VA loan eligibility, be sure to contact the VA directly.
Next Steps: Obtain Your Pre
If you are interested in purchasing a home with a VA loan, it will benefit you to get pre-approved. This will let you know the maximum loan amount that your income allows you to qualify for so that you can know your price range for homes. Shop for your home with confidence knowing that you have gone through the approval process.
If youd like to get pre-approved, call 240-3742 to speak with a knowledgeable lender, or simply complete a contact request form.
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No Down Payment On A Va Loan
Most home loan programs require you to make at least a small down payment to buy a home. The VA home loan is an exception.
Rather than paying 5%, 10%, 20% or more of the homes purchase price upfront in cash, with a VA loan you can finance up to 100% of the purchase price.
The VA loan is a true no-money-down home mortgage opportunity.
Discharged Members Of The Guard And Reserves
If you do not meet requirements for time served on active duty, and you are no longer in the Guard or Reserves, then you can send copies of your separation paperwork or other accepted forms. These include:
- National Guard: NGB Form 22, Report of Separation and Record of Service, for each period of National Guard service, or, NGB Form 23, Retirement Points Accounting, and proof of the character of service
- Reserves: Copy of your latest annual retirement points statement and evidence of honorable service.
Once you have your proof of service, you will provide this to the VA, which will issue you a Certificate of Eligibility.
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