VA loan requirements include military service eligibility (90 days wartime or 181 days peacetime), a Certificate of Eligibility (COE), no official minimum credit score (though most lenders require 620+), sufficient residual income after debts and a property that meets VA minimum property requirements. VA loans offer zero down payment, no PMI and competitive interest rates exclusively for veterans, active military and eligible surviving spouses.
What Is a VA Loan?
VA loans are mortgages guaranteed by the U.S. Department of Veterans Affairs. The VA doesn’t lend money directly—it guarantees a portion of the loan, protecting lenders against loss. This guarantee allows lenders to offer exceptional terms.
VA loan benefits:
- Zero down payment required
- No private mortgage insurance (PMI)
- Competitive interest rates (often 0.25-0.5% lower)
- Limited closing costs
- No prepayment penalties
- Easier qualification than conventional loans
- Assumable loans (buyers can take over your loan)
Who Is Eligible for a VA Loan?
Eligibility depends on your military service history and discharge status.
Service Requirements
Wartime service (any of these conflicts):
- WWII (9/16/1940 - 7/25/1947)
- Korean War (6/27/1950 - 1/31/1955)
- Vietnam War (8/5/1964 - 5/7/1975)
- Persian Gulf War (8/2/1990 - present)
Minimum wartime service: 90 consecutive days of active duty
Peacetime service:
- Between wartime periods
- Minimum: 181 consecutive days of active duty
National Guard and Reserves:
- 6 years of service in Selected Reserve or National Guard, OR
- 90 days of active duty (at least 30 consecutive) under Title 10 orders
Discharge Requirements
You must have been discharged under conditions other than dishonorable:
- Honorable discharge ✓
- General discharge (under honorable conditions) ✓
- Other than honorable - may qualify with VA determination
- Bad conduct or dishonorable - generally not eligible
Other Eligible Borrowers
Surviving spouses qualify if:
- Veteran died in service or from service-connected disability
- Veteran was MIA or POW for 90+ days
- Veteran was totally disabled and spouse didn’t remarry before age 57
Current active duty service members can use VA loans while serving.
Marcus Chen served 4 years in the Army with an honorable discharge in 2018. He easily qualifies for a VA loan. His wife Sarah, who never served, becomes eligible as a co-borrower on his application.
Certificate of Eligibility (COE)
The COE proves your VA loan eligibility to lenders. You’ll need one before applying.
How to Get Your COE
Option 1: Online through eBenefits
- Create an account at eBenefits.va.gov
- Request COE online
- Receive instantly if records are available
Option 2: Through your lender
- Most VA-approved lenders can pull your COE electronically
- Takes minutes if your records are in the VA database
Option 3: By mail
- Submit VA Form 26-1880
- Include proof of service (DD-214, statement of service)
- Takes 4-6 weeks
Documents Needed for COE
Veterans: DD Form 214 (Certificate of Release or Discharge)
Active duty: Statement of Service from your commanding officer showing:
- Full name
- Social Security number
- Date of birth
- Entry date
- Duration of any lost time
- Name of command
National Guard/Reserves:
- Statement of service
- Points statement
- Retirement points record
VA Loan Credit Requirements
The VA doesn’t set a minimum credit score. However, lenders have their own requirements.
Lender Credit Minimums
| Lender Type | Typical Minimum |
|---|---|
| Major banks | 640-660 |
| Credit unions | 620-640 |
| VA specialists | 580-620 |
| Some niche lenders | 500-580 |
Shop around if your score is lower. VA lenders vary widely in their requirements. Some specialize in helping veterans with credit challenges.
Credit History Factors
Beyond the score, lenders look at:
Positive factors:
- On-time mortgage or rent payments (12+ months)
- Limited new credit accounts
- Low credit utilization
- Long credit history
Negative factors:
- Recent late payments
- Collections and charge-offs
- Bankruptcy (2-year wait typically)
- Foreclosure (2-year wait typically)
Bankruptcy and Foreclosure
Chapter 7 bankruptcy: Generally need 2 years since discharge date
Chapter 13 bankruptcy: May qualify after 12 months of on-time plan payments with court approval
Foreclosure: Generally need 2 years since foreclosure date
Short sale: May qualify immediately if all payments were current
David Rodriguez had a Chapter 7 bankruptcy discharged 26 months ago. He rebuilt his credit to 640 and qualified for a VA loan. The lender required a letter explaining the circumstances that led to bankruptcy.
VA Loan Income Requirements
The VA uses residual income rather than traditional debt-to-income ratios as the primary qualifier.
Residual Income Explained
Residual income is the money left over after paying:
- Proposed mortgage payment (PITI)
- All monthly debts
- Estimated maintenance and utilities
- Federal, state and local taxes
Why residual income matters: It measures whether you have enough money left for food, transportation, healthcare and other living expenses—not just whether you can technically afford the payment.
Residual Income Minimums
Requirements vary by region, family size and loan amount.
For loans under $80,000:
| Family Size | Northeast | Midwest | South | West |
|---|---|---|---|---|
| 1 | $390 | $382 | $382 | $425 |
| 2 | $654 | $641 | $641 | $713 |
| 3 | $788 | $772 | $772 | $859 |
| 4 | $888 | $868 | $868 | $967 |
| 5+ | $921 | $902 | $902 | $1,004 |
For loans $80,000+:
| Family Size | Northeast | Midwest | South | West |
|---|---|---|---|---|
| 1 | $450 | $441 | $441 | $491 |
| 2 | $755 | $738 | $738 | $823 |
| 3 | $909 | $889 | $889 | $990 |
| 4 | $1,025 | $1,003 | $1,003 | $1,117 |
| 5+ | $1,062 | $1,039 | $1,039 | $1,158 |
Add $75 for each family member over 5.
Debt-to-Income Ratio
While residual income is primary, DTI still matters:
VA guideline: 41% back-end DTI
With compensating factors: Higher DTI may be approved
Compensating factors include:
- Residual income 20%+ above minimum
- Excellent credit history
- Long-term employment stability
- Significant liquid assets
- Conservative use of credit
- Military benefits (tax-free income)
- Minimal payment increase from current housing
Income Documentation
W-2 employees:
- 2 years of W-2s
- 30 days of pay stubs
- Verification of Employment (VOE)
Self-employed:
- 2 years of personal tax returns
- 2 years of business tax returns (if applicable)
- Year-to-date profit and loss
Military-specific income:
- Leave and Earnings Statement (LES)
- BAH (Basic Allowance for Housing) - counts as income
- BAS (Basic Allowance for Subsistence) - counts as income
- Special pay and bonuses (with 12-month history)
VA Funding Fee
VA loans don’t require PMI, but most borrowers pay a one-time funding fee.
2024 Funding Fee Rates
First-time use:
| Down Payment | Active Duty/Veteran | Reserves/Guard |
|---|---|---|
| 0% | 2.15% | 2.40% |
| 5-9.99% | 1.50% | 1.75% |
| 10%+ | 1.25% | 1.50% |
Subsequent use:
| Down Payment | Active Duty/Veteran | Reserves/Guard |
|---|---|---|
| 0% | 3.30% | 3.30% |
| 5-9.99% | 1.50% | 1.75% |
| 10%+ | 1.25% | 1.50% |
Funding Fee Exemptions
You don’t pay the funding fee if:
- You receive VA disability compensation
- You’re eligible for VA disability (claim pending)
- You’re a surviving spouse of a veteran who died in service
- You’re a Purple Heart recipient on active duty
Example calculation:
$350,000 loan, first-time use, zero down:
- Funding fee: $350,000 × 2.15% = $7,525
- Can be financed into the loan
- New loan balance: $357,525
Jennifer Walsh receives 30% VA disability. She paid zero funding fee on her $285,000 VA loan, saving her $6,128.
VA Property Requirements
The property must meet VA Minimum Property Requirements (MPRs) and serve as your primary residence.
Eligible Property Types
Allowed:
- Single-family homes
- Condos (VA-approved or individual approval)
- Townhouses
- Manufactured homes (on permanent foundation)
- Multi-unit properties (up to 4 units, must occupy one)
- New construction
Not allowed:
- Investment properties
- Vacation homes
- Commercial properties
- Houseboats
- Properties with income-producing land
Minimum Property Requirements
VA appraisers check for:
Safety:
- Adequate heating for climate
- Safe drinking water
- Proper sanitation
- No lead paint hazards
- Safe electrical systems
- Working smoke detectors
Structural soundness:
- Solid foundation
- Roof with reasonable remaining life
- No termite damage
- No water intrusion
Habitability:
- Working plumbing
- Functional kitchen
- Adequate natural light
- Sufficient space for intended use
Common VA Appraisal Issues
| Issue | Typical Resolution |
|---|---|
| Peeling paint | Seller scrapes and repaints |
| Missing handrails | Install before closing |
| Exposed wiring | Electrician repair |
| Non-working appliances | Repair or escrow |
| Crawl space moisture | Vapor barrier installation |
| Roof at end of life | New roof or escrow |
The VA is more flexible than FHA on some issues. Cosmetic problems typically don’t require repair.
VA Loan Limits
For most veterans with full entitlement, there’s no loan limit—you can borrow as much as a lender will approve with zero down payment.
Full Entitlement vs. Reduced Entitlement
Full entitlement (no limit):
- Never used VA loan before, OR
- Used VA loan but sold home and repaid loan, OR
- Used VA loan and had a one-time restoration
Reduced entitlement (limits apply):
- Currently have an active VA loan
- Defaulted on a previous VA loan
County Loan Limits (Reduced Entitlement Only)
If you have reduced entitlement, limits equal conforming loan limits:
- Most counties: $766,550 (2024)
- High-cost areas: Up to $1,149,825
Bonus Entitlement for High-Cost Areas
Even with reduced entitlement, you may qualify for larger loans using bonus entitlement. The calculation is complex—work with a VA-specialized lender.
VA Loan vs. Other Loan Types
| Feature | VA | FHA | Conventional |
|---|---|---|---|
| Down payment | 0% | 3.5% | 3-20% |
| Credit minimum | None (620 typical) | 580 | 620 |
| Mortgage insurance | None | Required | Required under 20% |
| Funding/guarantee fee | 2.15% (waived for some) | 1.75% upfront | None |
| Seller concessions | Up to 4% | Up to 6% | Up to 3-6% |
| Property standards | Moderate | Stricter | Most flexible |
| Occupancy | Primary only | Primary only | Any |
Choose VA if:
- You have military service eligibility
- You want zero down payment
- You want to avoid monthly mortgage insurance
- You have limited savings
How to Apply for a VA Loan
Step 1: Obtain Your COE
Get your Certificate of Eligibility through eBenefits, your lender or by mail.
Step 2: Choose a VA-Approved Lender
Not all lenders do VA loans equally well. Look for:
- VA loan experience
- Competitive rates
- Strong veteran reviews
- Knowledge of military moves and situations
Step 3: Get Pre-Approved
Submit your documents:
- COE
- DD-214 or Statement of Service
- 2 years of tax returns and W-2s
- 30 days of pay stubs
- 2-3 months of bank statements
Step 4: Find a Home
Work with a real estate agent familiar with VA transactions. They’ll understand:
- MPR requirements
- VA appraisal process
- Seller concession limits
- Timeline expectations
Step 5: Close Your Loan
After your offer is accepted:
- VA appraisal ordered
- Underwriting review
- Clear conditions
- Sign documents and close
Timeline: 30-45 days from contract to closing (similar to conventional).
Frequently Asked Questions
Can I use a VA loan more than once?
Yes. You can use your VA loan benefit multiple times. If you sell your home and repay the loan, your entitlement is restored. You can also have two VA loans simultaneously under certain circumstances.
Does my spouse’s income count if they’re not a veteran?
Yes. Your non-veteran spouse can be a co-borrower, and their income counts toward qualification. However, their debts also count. If your spouse has significant debt, leaving them off the application might help qualification.
Can I buy a condo with a VA loan?
Yes, but the condo must be in a VA-approved complex. Check the VA’s condo approval list or ask about individual unit approval for unapproved complexes.
What if the appraisal comes in low?
Options include: seller reduces price, you pay the difference in cash, renegotiate the deal, or walk away. You can also request a Reconsideration of Value with comparable sales supporting higher value.
Can I use VA loan for investment property?
No. VA loans are for primary residences only. However, you can buy a multi-unit property (up to 4 units), live in one unit and rent the others.
How long must I live in a VA-financed home?
You must intend to occupy the property as your primary residence. There’s no specific time requirement, but the VA expects you to move in within 60 days of closing and maintain it as your primary residence.
Can I refinance with a VA loan?
Yes. Options include:
- VA IRRRL (Interest Rate Reduction Refinance Loan): Streamlined, minimal documentation
- VA Cash-Out Refinance: Access equity, can refinance from any loan type
David Thompson
Former Bank Underwriter, 20+ Years in Lending
Our team of mortgage experts provides accurate, up-to-date information to help you make informed decisions about your home financing.
FHA Loan Requirements: Complete Guide to Qualifying in 2025
FHA loan requirements explained: 580 credit score minimum, 3.5% down payment, DTI limits and property standards. Learn how to qualify.
Non-QM Loans: Mortgages for Borrowers Who Don't Fit the Box
Non-QM loans serve self-employed, investors and others who can't qualify traditionally. Learn about bank statement, asset-based and DSCR loans.
Self-Employed Mortgage Requirements: How to Qualify in 2025
Self-employed borrowers need 2 years of tax returns showing stable income. Learn documentation requirements, income calculation and tips for approval.