A VA loan offers several key advantages over other types of loans, making it a preferred choice for eligible veterans, active-duty service members, and certain military spouses.
Why Get A VA Loan Over Other Types?
Perhaps the biggest advantage is that a VA home loan lets qualified buyers buy a home with no down payment. Also, there are no monthly mortgage insurance premiums to pay. There are caps on the buyer's closing costs, and an appraisal that informs the buyer of the property value. For most loans on new houses, construction is inspected at appropriate stages and a one-year warranty is required from the builder. VA also performs personal loan servicing and offers financial counseling to help veterans experiencing financial difficulties.
What Are the VA Loan Service Requirements?
Generally, service requirements are as follows:
- You have completed at least 90 days of active duty service.
- You have at least six years of service in the Reserves or National Guard.
- You have served at least 181 days of active duty service during peacetime.
- You have 90 days of cumulative service under Title 10 or Title 32. For Title 32 service, at least 30 of those days must have been consecutive.
- You're the spouse of a military service member who died in the line of duty, or as a result of a service-related disability. (Read More: VA Loan Eligibility for Surviving Spouses)
It is possible to earn benefits if you have not met the minimum service requirements, and were discharged due to one of the following:
- Hardship
- Government convenience
- Reduction in force
- Certain medical conditions
- Service-connected disability
Which Uniformed Services Have VA Home Loan Benefits?
When most people think of VA loan eligibility, several military branches may come to mind. But did you know there are seven uniformed branches that have home loan benefits? These include:
- Army
- Navy
- Air Force
- Marine Corps
- Coast Guard
- Space Force
- National Oceanic Atmospheric Administration (NOAA)
- Public Health Service (USPHS)
For commissioned officers of NOAA and the USPHS, you may have access to VA loans. Please check the VA website for more information.
What If I've Used A VA Home Loan Before?
"As of 2020, if you have full entitlement, you don't have a VA loan limit," according to the VA. "Eligible veterans, service members and survivors with full entitlement no longer have limits on loans over $144,000."
There are no maximum dollar amounts for VA-guaranteed loans. Any limitations for the size of a VA loan are based on the home's reasonable value, or if the mortgage is sold to another lender.
If you're a veteran with full entitlement and you're getting a loan that's more than $144,000, the VA will guarantee up to 25% of the loan amount as long as your income and credit qualifications pass muster and the property appraises for the asking price.
Lenders may require that a combination of the guaranty entitlement and any cash down payment must equal at least 25 percent of the reasonable value or sales price of the property, whichever is less.
| Loan Amount | Guaranty | Dollar Amount | *Lender Amount |
| Up to $45,000 | 50% | $22,500 | $90,000 |
| $45,001 - $56,250 | 40-50% | $22,500 | $90,000 |
| $56,251 - $144,000 | 40% | $36,000 | $144,000 |
| $144,001 to $417,000 | 25% | $89,912 | $417,000 |
| Greater than $417,000 | The lesser of 25% of the VA county loan limit, or 25% of the loan amount | ||
| Manufactured Home or Lot | 40% | $20,000 | $80,000 |
| Note: The percentage and amount of guaranty is based on the loan amount including the funding fee portion when the fee is paid from loan proceeds, subject to maximum loan limitations. |
For Alaska, Hawaii, Guam, and U.S. Virgin Islands residents, note that maximum original loan amounts have now been increased 50% higher for first mortgages.
Are National Guard Members Eligible for VA Loans?
In the past, National Guard members were only eligible for the VA loan after six years of honorable service, following 90 consecutive days of service or after being discharged from active duty for a service-related disability.
But a law passed in 2021 made tens of thousands more National Guard members eligible for the VA home loans. The legislation expanded eligibility for Guard members and reduced the required days of service.
The law is retroactive, meaning Guard members who served years ago but meet the new criteria may now be able to tap into the VA loan benefit.
Do All Local Lenders Offer VA Loans?
Not necessarily. Choose a VA-approved lending institution that can handle your home loan. A lender can help you review your credit history and determine how much of a loan you can qualify for. Be aware that different lenders have different closing costs and other fees, so it pays to shop around.
What Types Of Repayment Options Are Available?
The VA guarantees 30-year loans with a choice of repayment plans: traditional fixed-rate where your interest rate stays the same for the life of the loan; Adjustable-Rate Mortgage (ARM) where the interest rate starts lower for a fixed period (usually 5 years); and in some areas, Growing Equity Mortgages, or GEMs, with gradually increasing payments with all of the increase applied to principal, resulting in an early payoff of the loan. There is no prepayment penalty.
There is also the VA Interest Rate Reduction Refinance Loan (IRRRL), also known as a "VA Streamline Refinance." This option allows you to refinance your existing VA loan to a lower rate or switch from an adjustable-rate to a fixed-rate mortgage. The process is streamlined, with less paperwork and no appraisal or income verification required in many cases.
Read more: IRRRL Facts for Veterans
What Forms Or Documents Do I Need To Qualify For a VA Loan?
Everyone is required to obtain a Certificate of Eligibility (COE). If you have any doubt about your VA loan eligibility, a COE will clear it up. It's proof you're entitled to home loan benefits.
You can get a COE printed instantly through your lender if the VA has sufficient data for you and if the lender has access to the VA's WebLGY system. If you are not in the system, your lender can still help you obtain your document. Ask your lender to provide the correct forms to fill out and expedite the process.
Otherwise, you can apply for a COE by using VA Form 26-1880. This application process requires a copy of your DD-214 (Certificate of Release or Discharge from Active Duty) showing character of service.
Additionally, applicants must document their credit, savings and employment information.
Does a Veteran's Home Loan Entitlement Expire?
No, a veteran's home loan entitlement does not expire. As long as the veteran still meets the eligibility requirements (such as having qualifying service), they can use their VA loan entitlement at any time.
What Are the VA Loan Eligibility Requirements for the Home?
You should know that the home you buy must meet VA minimum property requirements (MPRs), and that only certain types of homes can be financed under VA loans.
During the VA loan process, a VA-certified appraiser will use a checklist to ensure the structure meets MPRs. At a minimum, the home needs to be safe, sound, and sanitary with a good foundation, structure, and roof. Basic requirements like clean water, heat, power, and no health hazards are next on the list. Any home with pests, mold, rot, or broken windows will not pass muster. The home must also have year-round access on a well-maintained road. Other requirements include distinct living areas for sleeping, cooking, dining, and bathing. Check with your real estate agent for additional requirements.
Can I Build a Home With A VA Home Loan?
Yes. But there are several clauses that may make this difficult to accomplish. Many veterans use their VA Home Loan Certificate of Eligibility to negotiate in good faith a private home construction loan and then refinance the completed home using VA home loans.
Download a free VA Loan Guide today.
Can I Take Out a VA Loan For a Second Home or Vacation Cabin?
VA loans are intended for primary residences, not for second homes, vacation cabins or investment properties. The home you purchase with a VA loan must be your primary residence, and you are generally required to occupy it within a reasonable time after closing.
However, there is some flexibility. If you have already used your VA loan entitlement, you may be able to use any remaining entitlement to purchase another primary home, such as if you are relocating.
The law does allow the veteran's spouse to satisfy the personal occupancy requirement, if the veteran is unable to occupy the home right away.
What Can VA Loans Be Used For?
VA home loans are available for a variety of purposes including building, altering, or repairing a home; refinancing an existing home loan; buying a manufactured home with or without a lot; buying and improving a manufactured home lot; and installing a solar heating or cooling system or other weatherization improvements. You are also allowed to buy income property consisting of up to four units, provided you occupy one of the units.
How Does the VA-Guaranteed Manufactured Home Loan Work?
A private lender makes a VA-guaranteed manufactured home loan. The VA will protect the lender against loss if the veteran or a later owner fails to repay the loan. The amount VA will guarantee is 40% of the loan amount or the veteran's available entitlement, up to a maximum amount of $20,000. The guaranty amount is not the same as the amount a veteran can borrow.
Can a VA Loan Be Used to Buy Property In A Foreign Country?
No. The property must be located in the United States or its territories or possessions. The latter include Puerto Rico, Guam, Virgin Islands, American Samoa and Northern Mariana Islands.
Compare VA loan rates with the Military.com VA Loan rate table.
Can a Surviving Spouse Earn VA Loan Eligibility?
In the past, surviving spouses could be eligible for VA loans only if a husband or wife died on duty or from a duty-related injury. Now, when a veteran dies of any cause, a spouse may apply for a VA loan as long as the veteran lived with a duty-related condition for a period designated by the VA, and is eligible for compensation at the time of death. Some eligibility requirements include:
- Veterans who died in service, or of duty-related causes
- Veterans who were disabled and eligible for compensation
- POW or MIA
How Does Divorce Affect My VA Loan Eligibility?
Let's say a veteran uses their VA benefit to purchase a home with a spouse, and then divorces and the spouse is awarded the home. In this case, the veteran's entitlement cannot be restored unless the ex-spouse does one of two things: 1) refinances in their name and/or pays off the VA loan in full; or 2) is also a veteran and substitutes their own loan entitlement. The latter option transfers the loan responsibility to the ex-spouse's entitlement, allowing the veteran's entitlement to be restored.
Does the VA Have an Inventory of Foreclosed Homes?
Yes, the VA acquires properties as a result of foreclosures on VA guaranteed loans. These homes are available for purchase by the general public, including eligible veterans.
Some real estate agents specialize in VA foreclosures and can help you find and purchase VA-owned properties. Additionally, some local VA offices and regional loan centers may have information on available properties and additional guidance on the purchasing process.
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