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VA Loan Requirements: What You Need to Know to Qualify
The VA loan program, backed by the U.S. Department of Veterans Affairs, is a powerful tool
for active-duty service members, veterans, and eligible surviving spouses seeking
homeownership. With no down payment, competitive interest rates, and no private mortgage
insurance (PMI), VA loan requirements it’s one of the most beneficial loan programs
available. However, qualifying for a VA loan requires meeting specific criteria. This guide
outlines the essential requirements and how to determine your eligibility.
1. Service Requirements
Eligibility for a VA loan begins with your military service. The specific requirements depend
on your service branch and when you served:
● Active-Duty Service Members: Must serve at least 90 consecutive days during
wartime or 181 days during peacetime.
● Veterans: Eligibility is based on the dates and length of your service. For example,
veterans who served during World War II, Korea, or Vietnam need at least 90 days of
active service.
● National Guard and Reserves: Must complete six years of service, unless called to
active duty for 90 days during wartime or 181 days during peacetime.
● Surviving Spouses: Spouses of service members who died in the line of duty or due
to a service-connected disability may also qualify.
2. Certificate of Eligibility (COE)
A Certificate of Eligibility (COE) is a document that verifies your eligibility for a VA loan. You
can obtain your COE through:
● Online: Using the VA’s eBenefits portal.
● Lender Assistance: Most VA-approved lenders can retrieve your COE electronically.
● By Mail: Submit VA Form 26-1880 to the appropriate VA regional loan center.
Your COE will outline the amount of entitlement available to you, which determines how
much the VA will guarantee on your loan.
3. Credit and Financial Requirements
While the VA does not set a minimum credit score, most lenders require a credit score of at
least 620. Other financial factors include:
● Debt-to-Income Ratio (DTI): Ideally, your DTI should not exceed 41%, though
exceptions can be made for strong borrowers.
● Stable Income: Lenders evaluate your income to ensure you can handle mortgage
payments alongside other obligations.
4. Property Requirements
The home you’re purchasing must meet certain standards:
● Primary Residence: VA loans are intended for homes you plan to live in, not for
investment properties or vacation homes.
● VA Appraisal: The property must pass a VA appraisal, ensuring it meets safety and
habitability standards and is valued appropriately.
5. No Down Payment
One of the most appealing benefits of a VA loan is the no down payment requirement.
However, if the loan amount exceeds the VA guarantee, the lender may require a down
payment to cover the difference.
6. Funding Fee
Most borrowers must pay a VA funding fee, which helps sustain the program for future
service members. The fee amount depends on factors such as the loan type, down payment
size (if any), and whether it’s your first time using a VA loan. Borrowers with service-related
disabilities may be exempt.
7. Other Considerations
● Bankruptcy or Foreclosure: Past financial difficulties do not automatically disqualify
you. VA loans are often more lenient, provided you’ve re-established
creditworthiness.
● Restoration of Entitlement: If you’ve used your VA loan entitlement before, you may
need to restore it by paying off the original loan or selling the home.
Conclusion
Meeting VA loan requirements is straightforward if you understand the necessary
qualifications and steps. From proving your service with a COE to meeting credit and
property standards, the process is designed to make homeownership achievable for those
who have served. By working with a knowledgeable VA-approved lender, you can navigate
the process confidently and unlock the full benefits of the VA loan program.