Understanding VA Home Loan Requirements

If you’re looking to buy, refinance or remodel your home, be sure to review VA home loan requirements to see if you qualify.

Bottom Line Up Front

• VA loans are a great way for eligible Active Duty servicemembers, Veterans and their families to buy or refinance a home.
• No down payment is needed to purchase a home with a VA loan. Footnote 1
• Getting preapproved for a VA loan is the first step. Then you’ll want to establish your eligibility with the VA.

Time to Read

The US Department of Veterans Affairs (VA) guarantees loans made by qualified lenders, such as Navy Federal Credit Union, for the benefit of Active Duty servicemembers, Veterans and their families.

Meeting VA home loan requirements can help you buy, build or renovate your home with no down payment. Because the VA backs a portion of each loan in their VA Home Loan Guaranty Program, lenders can offer more favorable terms for new home purchases and refinancing.

If you're looking to buy, refinance or remodel your home, a VA appraisal may be required to ensure the property meets minimum requirements set by the VA. Be sure to review VA home loan requirements to see if you qualify for a mortgage.

VA Loan Credit Requirements

The VA doesn’t have a credit score or income level requirement in order to qualify for a VA loan. However, most lenders will have their own requirements. They'll look at your debt-to-income ratio to make sure you can pay your bills and cover your loan payment.

Your Path to Buying a Home With a VA Loan:

Navy Federal Credit Union makes the process easy for you. They’re a top VA lender Footnote 2 and can help you determine if you meet VA home loan requirements and answer any questions along the way.

1. Get preapproved for a loan. Receive a preapproval from Navy Federal and begin the home-buying process.
2. Obtain a Certificate of Eligibility (COE). This certificate from the VA confirms your military service and verifies you meet VA home loan requirements and are eligible to receive a VA-guaranteed loan. Your lender, such as Navy Federal, can establish eligibility and obtain a COE for you. You can also request a certificate from the VA.gov site.
3. Shop for a home. Work with a trusted real estate agent to find a home that meets your needs and fits your budget. Navy Federal can connect you with a qualified real estate agent in your area through our RealtyPlus® program. Footnote 3
4. Sign a home purchase agreement. Make sure the purchase agreement that your real estate agent drafts has a VA option clause. This clause states that you aren’t legally bound to purchase a home if the VA appraisal amount is lower than the seller’s asking price.
5. Get a VA appraisal. A VA-certified appraiser determines the home’s fair market value and looks for obviously needed repairs to ensure the property meets the VA’s Minimum Property Requirements (MPRs).
6. Have the home inspected. Hire a professional home inspector to check the home’s structure for defects and to inspect items like electrical wiring, plumbing, and heating and cooling systems.
7. Sign the closing documents. After the home closing, it’s official! Congratulations on your new home.

Understanding VA Loan Limits

There's no loan limit or down payment requirement for buyers who have full entitlement. If this is your first VA loan or you paid off your previous one, you should have full entitlement.

For buyers with remaining entitlement, loan limits are based on the county where they live. The remaining entitlement can be used on its own or together with a down payment to take out another VA loan. To check loan limits, visit the Federal Housing Finance Agency website.

For more information about VA home loan limits, visit the VA website.

Who Qualifies for a VA Loan?

Active Duty servicemembers, Veterans and their families are eligible. You or your spouse must meet at least one of the following requirements:

• Served 90 consecutive days of active service during wartime
• Served 181 days of active service during peacetime
• Served more than 6 years with the National Guard or Reserves
• Are the spouse of a military member who lost their life in the line of duty, or as the result of a service-related disability

According to a recent report released by Navy Federal Credit Union, not all eligible military members are aware that they can buy a home with a VA loan. Nearly 15% of respondents who had recently taken out a non-VA loan mortgage said they weren't aware of the VA loan benefit.

Can I Use My VA Loan Benefit More Than Once?

There’s no limit to how many times you can use your VA loan benefit as long as you meet eligibility requirements. The Department of Veterans Affairs can help you understand your eligibility.

The Navy Federal report revealed that even though a VA loan benefit can be used more than once, nearly half of Active Duty servicemembers and one-third of Veterans who participated in a survey believe it can only be used once.

What Documents Will You Need?

Depending on your military experience, you’ll need certain documents to meet VA home loan requirements.

• Statement of Service
• Relevant information about breaks and discharges (these will need to be given by your superior officer before you apply for a COE)

• Proof of an honorable service and discharge (DD Form 214)

• Statement of Service
• Relevant information about breaks and discharges (these will need to be given by your superior officer before you apply for a COE)

• Report of Separation and Record of Service (NGB Form 22)
• Retirement Points Statement (NGB Form 23)

• Retirement Points Statement
• Proof of an honorable service and discharge (DD Form 2014)

• Copy of spouse’s DD Form 214
• Marriage license

Why Get a VA Home Loan?

• Lower mortgage rates
• Lower or no down payments
• Excellent refinance program that helps buyers lower their payments or get cash back on equity
• Higher debt-to-income ratio allowed
• More flexibility in the event of bankruptcy or a foreclosure

If you're interested in buying a home with a VA loan, Navy Federal Credit Union can help. As a Top VA lender, they understand the unique needs of servicemembers and their families and can help you take advantage of the benefits you’ve earned.