VA Home Loan Requirements and Eligibility Guidelines for 2024
The VA loan program, offered by the U.S. Department of Veterans Affairs (VA), provides mortgages to veterans, service members and surviving spouses. VA home loan requirements are more flexible than other mortgage guidelines and include favorable terms, such as closing cost limits and no minimum required down payment.
VA loan requirements: Are you eligible?
Minimum service requirements
To qualify for a VA loan, you must meet the minimum service requirements or be a qualifying surviving spouse:
Active-duty service members must have served for at least 90 continuous days.
Veterans, National Guard and Reserve members must meet the minimum active-duty service requirements based on service dates.
Surviving spouses must be the spouse of a veteran who is missing in action, a prisoner of war or who died in service or from a service-related disability. Remarried spouses may be disqualified depending on when the marriage took place.
You can request your military service records online if you’re unsure when you served.
Certificate of eligibility
A certificate of eligibility (COE) proves to lenders that you’ve met the minimum service requirements and qualify for the VA home loan benefit. Requesting your COE is one of the first steps to applying for a VA loan.
There are three ways to request a COE:
→ Online: You can access or request your COE at VA.gov.
→ Through your lender: Your lender may be able to access your COE.
→ By mail: Send a completed request for a certificate of eligibility form to your regional loan center.
When you will need extra documents to get a COE
It’s possible to access your COE online and download it immediately, but some circumstances may require you to provide additional information, including if:
→ You’re an active-duty service member.
→ You’re a discharged National Guard or Reserve member who was never activated.
→ You’re a surviving spouse of a veteran who died on active duty or had a service-related disability.
Before requesting your COE, be sure to gather the necessary information based on your service status.
VA funding fee payment at closing
A VA funding fee is a percentage of the loan amount and depends on the down payment, loan type and whether a borrower has had a VA loan before. Most VA borrowers pay the funding fee at closing.
This one-time payment helps fund the VA loan program and its lenient terms, including competitive interest rates, no minimum required down payment and no ongoing mortgage insurance. Borrowers can pay the funding fee upfront at closing or roll it into their loan amount.
Some borrowers, such as disabled service members, may qualify for a funding fee exemption.
| VA loan type | Down payment | First-time use | Subsequent uses |
|---|---|---|---|
| Purchase and construction loans | Less than 5% | 2.15% | 3.30% |
| 5% or more | 1.50% | 1.50% | |
| 10% or more | 1.25% | 1.25% | |
| Cash-out and regular refinance | Any amount | 2.15% | 3.30% |
| Interest rate reduction refinance loan (IRRRL) | Any amount | 0.50% | 0.50% |
No minimum credit score
VA home loan credit requirements don’t specify a minimum credit score — however, most lenders will usually look for at least a 620 score, though some lenders may accept VA borrowers with scores as low as 500. Besides looking at your scores, lenders will evaluate your income, debt payment history and other aspects of your credit history to determine if you qualify for the loan.
VA-approved lenders also use the Credit Alert Interactive Verification Reporting System (CAIVRS) to confirm that you haven’t defaulted on federal debt like student loans or a past VA loan.
Learn more about factors that affect your credit score.
Minimum down payment usually not required
Most VA loans don’t require a down payment, but lenders may impose a down payment requirement in some circumstances, including if:
→ You’re purchasing a home priced higher than the appraised value.
→ You’re currently repaying a VA loan.
→ You’ve paid off a previous VA loan but still own the home.
→ You’ve refinanced a previous VA loan into a non-VA loan and still own the home.
→ You’ve had a foreclosure or short sale on a previous VA loan and didn’t repay the loan.
Maximum debt-to-income ratio of 41%
VA home loan requirements recommend a maximum 41% debt-to-income (DTI) ratio. (To calculate your DTI ratio, divide your total monthly debt, including the expected mortgage payment, by your gross monthly income.) VA lenders may allow a DTI ratio above 41% if you have a significant amount of tax-free income or if your residual income is at least 20% higher than the guidelines. (See more about VA residual income guidelines below.)
Employment and income requirements
VA lenders must ensure that your income is reliable and consistent. They’ll look for at least two years of employment in most cases, though some lenders may make exceptions.
VA loan eligibility requirements don’t have specific income parameters — however, lenders must confirm you have enough “residual income,” which is cash available to handle living expenses after you pay your mortgage and other obligations. Residual income guidelines are based on your after-tax income, including that of any co-borrowers, as well as your family size and location.
VA loan requirements: Residual income guidelines for loan amounts above $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 |
| 6+ | Add $80 for each additional member up to a family of seven. | |||
No loan limits specified
The VA doesn’t impose specific loan limits; however, loan amounts can’t exceed the property’s value. In addition, lenders will determine your loan amount based on your credit, income and assets.
While VA requirements for home loans don’t dictate loan amounts, the VA does cap how much of the loan principal they guarantee (how much they’ll pay lenders if you default on a loan). Lenders consider this when determining your loan amount.
When your VA mortgage may have a loan limit
If you’ve used your VA home loan benefit before and still owe money on the mortgage or still own the property, you have what the VA calls “remaining entitlement.” In this case, your loan is subject to a maximum amount if it’s above $144,000.
When you have remaining (or partial) entitlement, lenders follow conforming loan limits set by the Federal Housing Finance Agency (FHFA) to determine your maximum loan amount.
The 2024 conforming loan limit for a single-family home in most of the U.S. is $766,550; however, limits vary by county. Borrowers with partial entitlement can borrow more than these limits if they make a down payment and meet the lender’s other requirements.
Property requirements
All homes financed with a VA loan must meet the VA’s Minimum Property Requirements (MPRs). The VA uses these guidelines to help ensure the home is “safe, structurally sound and sanitary.” MPRs vary depending on the property’s location and local requirements.
Lenders order an appraisal from a VA-approved appraiser to confirm the property meets the VA’s MPRs. After the assessment, borrowers receive a Notice of Value, which includes the appraisal report results, an estimate of the home’s value and a list of required repairs.
Occupancy requirements
New VA borrowers must follow the VA’s occupancy rules, in addition to meeting property requirements. These rules state that they must live in the home as their personal residence within 60 days of their loan closing. Exceptions are made in some situations: for example, if the borrower is deployed and can’t occupy the home.
Frequently asked questions
VA loan requirements limit what closing costs borrowers pay, and they cap the amounts on some charges. Lender fees (including the loan origination) can’t exceed 1% of the loan amount. VA borrowers may need to pay other customary closing costs, such as the VA appraisal, prepaid taxes, title insurance and discount points (if applicable); however, they can negotiate with sellers about which party pays for some of these charges. VA guidelines allow sellers to pay up to 4% of the loan amount in seller concessions, plus discount points.
You qualify for the VA funding fee exemption if:
→ You receive VA disability benefits for a service-related injury.
→ You’re eligible for VA disability benefits, but receive retirement or active-duty pay instead.
→ You’re an active-duty service member who has received the Purple Heart.
→ You’ve received a proposed or memorandum rating dated before your loan closing, which states that your service entitles you to receive compensation.
→ You’re the surviving spouse of a veteran who died while on duty or from a service-related illness or disability and receive Dependency and Indemnity Compensation (DIC).
VA loans don’t require mortgage insurance; however, most borrowers pay a one-time funding fee based on their loan amount, down payment and mortgage type.
Yes, military spouses can apply for a VA loan if they’re the spouse of a veteran who is missing in action or a prisoner of war, or who died in service or from a service-related disability.
If you don’t meet the minimum service requirements, you may still be eligible for a VA loan if you were discharged for one of the following reasons:
→ Hardship
→ Convenience of the government (you must have served at least 20 months of a two-year enlistment)
→ Early out (you must have served 21 months of a two-year enlistment)
→ Reduction in force
→ Specific medical conditions
→ Service-related disability