VA Loan Eligibility Requirements
The Department of Veterans Affairs establishes the service criteria for the VA loan. However, these aren’t the only criteria used to assess your eligibility for a VA loan. Borrowers must fulfill lender criteria in addition to the VA’s service requirements in order to qualify for a VA loan.
Many applicants are unaware that the VA’s criteria are mostly based on service history, and that the lender establishes standards for credit, income, and obligations based on general VA norms.
Who Qualifies For A VA Loan?
Regarding the service requirements for the VA loan, potential borrowers must fulfill one of the following criteria:
- Having completed 90 days of continuous active duty during a conflict,
- 181 days of continuous active duty during peacetime,
- 6 years in the National Guard or Reserves, or
- Be the spouse of a military person who passed away in the line of duty or suffered a disability as a result of their service.
Veterans who enrolled (and started serving) after September 7, 1980, or who joined the military as an officer after October 16, 1981, must have served for a longer period of time. One of the following must have been accomplished by these veterans:
- 24 months in a row of active duty.
- Completed the whole time for which they were summoned or given an active duty order. (Still, it cannot be less than 90 days in a time of war or 181 continuous days in a period of peace.)
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Compare Now!You may still be qualified even if you served less than the minimum amount of time with a non-dishonorable discharge. To find out your status, you can ask a lender to retrieve your Certificate of Eligibility (COE).
Speaking about your COE, you may begin the VA loan procedure by getting in touch with a lender and receiving it if you are unclear of your status. When you speak with a lender for your COE, the murky issues of overlapping service and whether basic training was considered part of your eligibility are resolved.
See the breakdown below if you’re still unclear about how war and peacetime differ from one another:
Wartime Service (90 Consecutive Days)
| War | Date Of Service |
|---|---|
|
World War II |
September 16, 1940 — July 25, 1947 |
|
Korean Conflict |
June 27, 1950 — January 31, 1955 |
|
Vietnam Era |
August 5, 1964 — May 7, 1975 |
|
Gulf War |
August 2, 1990 — Present |
Peacetime Service (181 Days)
| Peacetime Period | Date Of Service |
|---|---|
|
Post World War II period |
July 26, 1947 — June 26, 1950 |
|
Post Korean period |
February 1, 1955 — August 4, 1964 |
|
Post Vietnam period |
May 8, 1975 — August 1, 1990 |
Does Basic Training Count Towards my VA Loan Eligibility?
We frequently get asked if basic training counts against your 90 days of active-duty wartime eligibility when discussing the time in service criteria. The AIT and basic training do not contribute to the 90-day eligibility clock.
When Can I Use My VA Loan?
As soon as you fulfill the minimum service requirements of 90 consecutive days of active duty during a time of war, 181 consecutive days during a period of peace, or six years in the National Guard or Reserves, you are eligible to use your VA loan benefit.
VA Loan Restrictions
Discharge status is the main service limitation with a VA loan. Any person who was dismissed dishonorably is ineligible for a VA loan.
Basic VA Loan Guidelines
- The VA offers lenders offering VA loans extensive parameters in addition to servicing obligations. High-level requirements for obtaining a VA loan include:
- Be a Veteran or spouse of a service person who is eligible for a VA loan.
- Utilize the VA loans for purchasing a home, which is an acceptable use.
- Inhabit the property or expect to do so in a reasonable amount of time (usually within 60 days of closing).
- Be a credit risk that is acceptable.
- Own a reliable source of income that will allow you to handle all key bills, including your mortgage, your debts, the cost of having a house, and your living expenses, while still leaving you with money for discretionary spending.
Are There Any Other VA Loan Rules to Know?
There are no unusual regulations or restrictions. However, credit and income are two topics that borrowers frequently have concerns about.
For veterans and active duty service members who wish to use their VA loan benefit, the VA does not specify a minimum credit score. However, other lenders may, and VA lenders often do. However, with the VA guarantee, the credit score criteria are sometimes more flexible.
Lenders will calculate debt-to-income (DTI) ratios in a similar manner. This metric shows a borrower’s total monthly obligations and payments in relation to their gross monthly income. Although the VA prefers that borrowers have a DTI ratio of 41 percent or less, lenders sometimes permit greater DTI rates. Additionally, it may vary according on the lender.
Are there Income Requirements with VA Loans?
There is a criterion for residual income for VA loans. Your remaining funds after paying all significant bills and commitments are known as residual income.
To guarantee that borrowers and their families will have enough money to pay essential living expenses (such as food and transportation), residual income is calculated. Amounts vary depending on the size of the family and the location of the borrower. These residual income criteria have contributed to the VA loan program’s low foreclosure rate.
What's the Best Way to See if I'm Eligible for a VA Loan?
The easiest method to find out if you qualify is to speak with a lender beforehand. In a matter of minutes, a lender may check your Certificate of Eligibility to determine whether you match the minimal service requirements and qualify for a VA loan. A lender may also examine your financial data to see if you fulfill their income and credit requirements.