VA Loan Eligibility

1. Factors Affecting VA Loan Eligibility Designed to help millions of homeless Veterans attain homeownership, VA home loans are VA-backed mortgage programs provided by private lenders on lower interest rates. In addition to having the lowest interest rates in the market, these mortgages offer other benefits as well. However, to reap these benefits, one must satisfy the VA loan eligibility guidelines established by the department. VA LOAN ELIGIBILITY REQUIREMENTS To qualify for a VA loan, an applicant must pass the eligibility criteria determined by the VA. According to the department’s guidelines, VA loan eligibility is determined on three primary factors- 1. Requirements for COE 2. Credit Requirements 3. Property Requirements ELIGIBILITY REQUIREMENTS FOR COE The COE or Certificate of Eligibility is one of the most important documents needed to satisfy VA loan eligibility guidelines. To qualify for COE, an applicant must meet either of the following conditions- 1. He/she is an active/current military member who has served at least 90 consecutive days during peacetime. 2. He/she is an active/current military member who has served at least 181 consecutive days during wartime. 3. He/she is a reservist of a national guard with at least six years of experience. 4. He/she is a family member of a Veteran who went missing in action, was a prisoner of war or died on duty/from a service-related disability. An applicant can either apply online, through mail or by getting in touch with a regional office. To apply for the document, a Veteran will be required to fill out DD Form 214. Applying as an active military member would require an applicant to produce his/her statement of service. The statement of service must include the applicant’s- Full name Date of birth Social security number Any lost time Name of the official he/she was answerable to Joining date • • • • • •

2. CREDIT REQUIREMENTS As per the guidelines mentioned by the US Department of Veterans Affairs, an applicant does not need an outstanding credit score to meet VA loan eligibility requirements. However, these loans are provided by private lenders and most lenders will expect you to have a minimum credit score of at least 620. In addition to this, an applicant must have paid all the dues of a pre-existing debt, in time, for at least 12 months. Moreover, an applicant must also have enough residual income and a DTI ratio of less than 40%. PROPERTY REQUIREMENTS To determine VA loan eligibility, the department has also defined certain property requirements that could affect the value or safety of the property. These requirements are also called Minimum Property Requirements or MPRs. Here’s the list of MPRs that must be met to qualify for a VA mortgage. The property must- Have a clean and continuous water supply. Have adequate space for basic necessities like eating or sleeping. Have appropriate roofing Not have lead-based paint be free from any termite infestation or other insects have safe and sanitary sewage disposal be accessible to a public/private street Have proper attics, storage and ventilation • • • • • • • • Another vital factor to consider while determining VA loan eligibility is that VA loans are available only for primary residence. You can not borrow this loan to purchase an investment property or a vacation home.