VA Loan Requirements

The Department of Veterans Affairs has outlined some of the requirements that make a person eligible for a VA loan. The borrower:

Outside of these requirements, it’s fairly easy to qualify for a VA loan. There is no minimum credit requirement although each lender will typically have their own standards, which fall within the low to mid-600 credit score range.

• Must have completed at least 90 days of active-duty service during wartime
• Must have completed 181 days of active-duty service during peacetime
• If not the soldier, he or she must be the surviving widow/widower of the deceased veteran who died in service or from a service-related injury or disability (also applies to missing soldiers and prisoners of war)
• Must use the VA loan for their primary residence
• Must move into their house within 60 days of purchase
  
   

There’s no down payment requirement, either, but you may need one in order to compete with other prospective buyers. The VA also prefers that your DTI be no higher than 41%. As of this year, VA loan limits are $548,250 but may reach up to $800,000 in counties where the cost of living is higher.

There’s no down payment requirement, either, but you may need one in order to compete with other prospective buyers. The VA also prefers that your DTI be no higher than 41%. As of this year, VA loan limits are $548,250 but may reach up to $800,000 in counties where the cost of living is higher.

Lenders are required to obtain a Certificate of Eligibility (COE) and this will dictate how much of a loan that the veteran can take out. If the veteran already has one VA mortgage and/or defaulted on one in the past, their eligibility for a new loan will be outline on the COE.

VA loans are not available to those who were discharged dishonorably for bad conduct or otherwise, but if you do not meet the requirements for length of service, you may still be eligible. Contact the VA for more information.

VA loans are not available to those who were discharged dishonorably for bad conduct or otherwise, but if you do not meet the requirements for length of service, you may still be eligible. Contact the VA for more information.

VA Loan Requirements

VA loans are backed by the Department of Veterans Affairs in the event that you, as the borrower, default on the loan. Because of this, VA home loan lenders have the peace of mind and security needed to provide loans with no down payment requirement and with favorable rates and terms. If you want to take out a VA loan, here’s how the process might look

Prequalify: Prequalification is the first step in the VA mortgage lending process. You will get together with a VA lender to get an idea of what you can afford to pay for a home based on your financial situation.

Obtain a preapproval: If you’re confident in your ability to obtain a loan after prequalification, you can move forward to preapproval. In this step, your lender will collect documentation to verify your income and finances to determine your actual purchasing power. You’ll walk away with a letter to show sellers and their agents that you are a serious buyer in good standing.

Offer on a home: Next comes the fun part: house hunting and offering on a VA loan-approved home you love. Be sure to utilize the expertise of an agent who understands VA loans and can help you draft up a reasonable offer.

VA appraisal/underwriting: This is a step that differs from other loan processes. With VA loans, the property in question must be appraised to verify that it meets VA property requirements as well as fair market value. You can read about VA property requirements here. While the appraisal is happening, your loan underwriter will determine your worthiness as a borrower nd clear you to receive VA loan funding.

Closing: Finally, once all of the hurdles have been jumped, you can start signing the paperwork to transfer the title to your name and close on the property!

VA loans make homeownership possible for people who thought they may never qualify for a mortgage loan. With a VA loan, there’s no mortgage insurance requirement, and you can qualify with less-than-perfect credit, even if your debt-to-income ratio (DTI) is high. In fact, you may not even be required to provide a down payment. What’s more, if you decide to move again in the future, you can continue to use the VA loan benefit on your next home.