VA Loan Eligibility

VA loans are a home financing benefit offered through the VA. They help eligible service members, Veterans, and certain surviving spouses buy or refinance homes with convenient terms. Here is what you should know about VA home loan eligibility and who qualifies.

Am I Eligible?

Like all mortgage programs, VA loans have certain mandatory qualifications to ensure that borrowers can repay them. However, unlike conventional loans, there is no down payment requirement for a VA loan.

VA loans have time-in-service requirements for Veterans and active service members.

Service requirements can vary based on when you served, but typically include:

• 90 consecutive days of active service during wartime
• 181 days of active service during peacetime
• Six years of service in the Reserves or National Guard
• Discharge under conditions other than dishonorable
• Spouse of a service member who passed in the line of duty or as a result of a service-connected disability

Is the National Guard Eligible for a VA Loan?

Yes, members of the National Guard are typically eligible for VA loans, provided they meet the VA’s requirements.

National Guard members and reservists may be eligible for VA home loans if they've completed at least six years of service and fulfilled the following requirements:

• Served 90 consecutive days under Title 10 active duty orders
• Served 90 cumulative days under Title 32 service under sections 316, 502, 503, 504, and 505 with at least one period of service lasting 30 consecutive days
• Discharged honorably, placed on the retired list, or transferred to Standby Reserve or Ready Reserve after honorable service
• Continue to serve in the Selected Reserve

Are Spouses Eligible for the VA Loan?

Yes, certain military spouses can be deemed eligible for VA loan benefits, but only under certain circumstances:

• As the unremarried spouse of a Veteran who died while in service or from a service-connected disability
• As the spouse of a service member missing in action or a prisoner of war for at least 90 days

Other VA loan eligibility scenarios exist, but these are the most common guidelines.

How to Get Your Certificate of Eligibility (COE)

A Certificate of Eligibility (COE) verifies your entitlement to a VA loan. You can request your COE through the VA or have your lender obtain it for you. Without this document, you cannot obtain a VA loan.

You can start the homebuying process before you obtain your COE. However, you must have it before you close on your loan.

To get your COE, you may need to provide proof of your eligibility to the VA in the following ways, depending on your service status:

• Veterans: DD Form 214 (discharge or separation papers)
• Service members: A statement of service signed by your commander, adjutant, or personnel officer that shows:
  • Your full name
  • Your Social Security number
  • Your date of birth
  • The date you entered duty
  • The duration of any lost time
  • The name of the command providing the information
• Current or former activated National Guard or Reserve members: May need a points statement and a copy of your discharge paperwork
• Other service members or spouses who qualify: Requirements vary

Lender-Specific Requirements

All mortgage loans have certain mandatory qualifications to ensure that borrowers can repay them, and the same is true for VA loans. However, unlike conventional loans, VA loans do not require a down payment.

The VA doesn't set specific borrower qualifications. Each lender has its own approval standards, which can vary.

For example, the VA doesn’t set a minimum credit score, but most lenders typically require a credit score around 620 or higher. Comparing lenders helps you find the best terms and qualification requirements before applying.

VA lenders also consider residual income, which is what’s left over each month after you pay your major expenses and debts. The VA uses this number to make sure you still have enough money for everyday needs like food, medical care, and gas. VA underwriters figure out your residual income using the Loan Analysis Form 26-6393. This requirement is unique to VA loans, but it plays an important role in determining whether you qualify.

VA loans also take into account your debt-to-income ratio, just like conventional loans. That said, VA loans do not have a maximum debt-to-income ratio (DTI), which can make it easier to qualify for those with higher amounts of debt and a lower income.

DTI ratio limits vary by lender and other factors. Veterans with a DTI ratio greater than 41% must meet a higher benchmark for residual income.

VA Eligibility vs Other Loans

Veterans have several options for home loans, and a VA loan is often one of the more accessible and affordable choices. VA loans offer flexible credit requirements, no required down payment, and other benefits that make it easier to buy a home. To use a VA loan, you must meet eligibility requirements established by the VA.

The VA loan offers unique benefits that set it apart from most conventional loans.

Ready to start your home loan search? First Residential can help you find the right mortgage loan for your unique needs.

Common VA Loan FAQs

Do I qualify for a VA loan?

You may qualify for a VA loan if you meet military service requirements, have a Certificate of Eligibility (COE), meet your lender’s credit and income standards, and plan to live in the home as your primary residence.

Do VA loans require a down payment?

No. VA loans don’t require a down payment. However, making one can lower your VA funding fee cost and increase your home equity.

Do VA loans require private mortgage insurance (PMI)?

No. VA loans do not require PMI. Instead, they include a one-time VA funding fee that keeps the program self-sustaining.

Can I use a VA loan more than once?

Yes, you can use your VA benefit more than once, as long as you restore your entitlement after paying off or selling your previous VA-financed home.

Do I need a certain credit score requirement for a VA loan?

The VA doesn’t set a minimum credit score, but most lenders, like First Residential, typically recommend a credit score of at least 620.

Can a surviving spouse qualify for a VA loan?

Yes, certain surviving spouses of Veterans may qualify for a VA loan, especially if the Veteran passed in service or due to a service-connected disability.

Can I get a VA loan if I’m in the National Guard or Reserves?

Yes, members of the National Guard or Reserves may qualify if they’ve served at least six years, completed 90 consecutive days of active duty, or were discharged due to a service-connected disability.

Do VA loans have income requirements?

No, the VA doesn’t set a specific income limit, but you must have a stable, reliable income that meets the VA’s residual income guidelines.