VA Loan Eligibility

VA Home Loan Requirements

For over 75 years, the U.S. Veterans Administration has helped pave the way for many active and former military personnel to achieve the goal of purchasing a home. While many people think that the process of obtaining a loan through the VA is complicated, it is not. By being prepared and understanding the VA loan eligibility process, you can get approval much sooner than you thought possible. Let’s take a look at the basics of the eligibility requirements for this unique program.

Who Is Eligible For A VA Home Loan?

The following individuals are eligible to apply for a VA home loan.

  • Active-duty personnel who have served at least 90 days.
  • A former military member who has served either 90 days in wartime or 181 days during n peacetime.
  • National Guard or Reserve personnel who have served for six credible years.
  • A surviving spouse of a military member who died while in service or as a result of a service-related disability.

Credit Score

Because VA loans are granted by private lending institutions (but backed by the federal government), the Veterans Administration does not specify that an applicant must have a minimum credit score to qualify for a loan.

Credit score requirements, however, can be set by the lender and typically speaking, most of them will look favorably upon applicants who have a score of 620 or higher. Financial institutions will also want to see a history of timely debt payments on an applicant’s credit report in addition to an acceptable credit score.

Debt To Income Ratio

Another critical aspect of the VA loan eligibility process is to meet proper debt to income requirements.
Simply put, the debt to income ratio is a calculation that measures a person’s monthly gross income against the amount of debt payments that they have to make each month. For VA loans, it is advisable to keep debt to income ratio under 41%. In other words, if you have a gross monthly income of $4,000, your total debt payments (including your mortgage) should not be more than $1,640.

Depositing A Down Payment

Most loan programs require borrowers to put down between 3-20% of the purchase price of the home as a down payment. One of the many unique features of a VA loan is that in most situations, a down payment is not needed. This puts many active and former military members in a position to purchase a residence, whereas they would be unable to if a down payment were needed.

Property Type Requirements

While it is a myth that only single-family homes can be purchased through a VA loan, the Veterans Administration does specify which kinds of properties are eligible under the program. These include:

  • Multi-Family Properties
  • Manufactured Homes
  • Single Family Homes
  • Condo Units
  • New Construction

The VA Home Loan Appraisal Process

Every property that is purchased through a VA loan must have an appraisal done before the financing can be approved. An appraisal accomplishes many things. First, it confirms that the loan amount is consistent with the value of the home and that the property meets other VA requirements, such as being structurally sound, safe, and sanitary.

Apply For A VA Loan

Since 1944, the Veterans Administration has provided millions of military families with the opportunity to experience the pride of homeownership. The knowledgeable team at Better Lending has helped thousands of active and former members of our armed forces buy a home through the VA loan program.

Contact us today to learn more about this unique program and why so many active and retired military personnel have chosen us over the years to be their trusted lender through the VA loan process.

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