Armed Forces Veterans and current Military Service Members are in a great position when they decide to purchase or refinance a home.  They have access to Low Interest VA Loans that enable them to buy a home with no down payment and no mortgage insurance.  In today's lending climate, there isn't another mortgage loan program that offers such favorable terms.  And VA Loans can be used to purchase a home with zero down up to $417,000 ($729,750 in some areas).

Today's VA Loan Requirements

Service Requirements

Generally, for a service member or veteran to be eligible for a VA Loan, they will need to have completed any of the following:

• 181 Days of Peacetime Active Duty Service
• 91 Days of Wartime Active Duty Service
• 6 Years of Reserves or National Guard Service

If any of those are true or you are the spouse of a servicemember who was killed in action, you are likely eligible for a VA Loan.  You will need to make contact with a VA Loan Specialist to help you obtain your certicate of eligibility and let you know exactly how much you qualify for.

Income Requirements

VA Loans use two methods to qualify a veteran's income. The primary method of evaluating a veteran's income is residual income. This method determines if a veteran has sufficient income to cover daily living expenses after paying housing expenses, taxes, and other debts such as car payments and credit card payments. The second method is a debt-to-income ratio method like other mortgage types. VA Loans only use one ratio which is the ratio of total debt to income including your new house payment.  Using this method, the veteran's total debts should not exceed 41% of the veterans total income.

Credit Requirements

The VA does not set a minimum credit score requirement to insure VA Loans.  Most lending institutions require a 620 FICO score or better, however, to approve a VA Loan Application.  The VA Loan underwriter will be generally be looking for at least one year of good credit history.  Past Bankruptcy may be OK, but all payments must have been on time for at least one year.  If the Bankruptcy was a Chapter 7, the veteran must wait at least two years from the discharge date to apply for a VA Loan.

VA Loan Certificate of Eligibility

Before you can get a VA Home Loan, you must first obtain your VA Loan Certificate of Eligibility (COE).  To obtain your Certificate of Eligibility, you must complete the VA Form 26-880 Certificate of Eligibility request.  You may be able to obtain your COE by submitting your completed VA Form 26-880 and your Form DD-214 Discharge Papers to your lender. If your lender is approved to use the VA's Automated Certificate of Eligibility system (ACE), you may be able to get your COE in less than 24-48 hours.  If your lender is not approved to use the ACE system, it could take significantly longer.

If you have any additional questions about the current VA Loan Requirements, please contact us This e-mail address is being protected from spambots. You need JavaScript enabled to view it .