If you served in the military, you may be eligible for VA loan benefits. The benefits are available to a variety of those with military service, including active duty members, veterans, and members of the National Guard or Reserves. In fact, some spouses are even eligible if they lost their spouse during active duty or as a result of their spouse’s active duty.
In order to prove your eligibility for the program, you must prove that you served the required time in the service. When and where you served will determine how long your service must be before you are eligible for the program.
The Basic Military Service Requirements
Following is a generic outline of how much military service you need in order to qualify for a VA home loan benefit:
- If you served during wartime, you served at least 90 consecutive days
- If you served during peacetime, you served at least 181 consecutive days
- If you served in the Reserves or National Guard, you served at least 6 years
- If you are a spouse of a veteran that died during active duty or as a result of his line of duty, there are no minimum service times
Proving Your Military Service
The only way to prove that you have enough time served in the military is with your Certificate of Entitlement. You must request this certificate – it’s not something you receive automatically. If you don’t already have a certificate, the chosen lender can obtain it for you. VA lenders have access to an automated system that gives them the certificate within a few minutes of the request.
You can also request the certificate yourself by applying through the VA eBenefits portal or complete VA Form 26-1880 and send it via mail.
The Other VA Requirements
Your military service requirements just make you ‘eligible’ for the VA loan. Just because you served enough time in the military doesn’t mean you qualify for the loan, though. You have to prove that you qualify for the loan by proving that you meet all of the following requirements:
- Proof of consistent and reliable income
- Proof that you have enough disposable income each month after paying your bills
- Proof that you have enough income to keep your total debt ratio at or below 43%
The VA does not require a down payment or have any type of asset requirements. As long as you have the funds to cover your closing costs and the funding fee or you have other resources to cover them, you don’t have to worry about assets. If you do use your own funds to cover the expenses, though, you will have to prove that you have the funds and that they are seasoned (in your account for at least a few months).
The VA does allow veterans options if they cannot pay the closing costs and/or funding fee themselves:
- Accept gift funds – If you have a relative or employer that will provide you with the funds and you can prove that they are a gift, the VA will allow use of the funds
- Roll the costs into the loan – You may also be able to roll your closing costs and funding fee into your loan amount if the lender allows it and it fits within your debt ratio
You’ll need to shop around to find a VA lender that works for you. All VA lenders will have the same military service requirements because that’s a VA requirement. The other requirements, though, may vary by lender. Each lender must follow the VA’s minimum requirements, but many lenders add more requirements just to make the loans that they fund less risky.