VA Loan Articles
News, updates, and explanations to keep you informed.
VA Loan Entitlement and Eligibility
If you’re a military member or veteran in the market for a VA home loan, there are two basic things you need in order to get the process moving. One is your basic eligibility for the VA mortgage itself, the other is how much of that entitlement you have coming. First time home buyers with enough time in the service to qualify for a VA mortgage don’t have any worries when it comes to the entitlement issue; if you have never used your VA loan benefits and you qualify, you have 100% of your VA loan entitlement available to you.
To start the process, you must apply for a Certificate of Eligibility from the Department of Veterans Affairs. When the VA responds to your application, they issue qualified applicants a Certificate of Eligibility telling your lender (and you) two things:
* The borrower has served in the military long enough to earn and use VA home loan benefits.
* The amount of the borrower’s entitlement to use for the VA loan.
It’s easy to assume that because you’ve served in the armed forces you’re automatically eligible for ALL the benefits offered by the Department of Veterans Affairs; the truth is that vets and active service members are eligible for VA guaranteed home loans only when they meet certain general rules:
* The applicant must have served on active duty in the Army, Navy, Air Force, Marine Corps, or Coast Guard after September 15, 1940.
* The applicant must not have a dishonorable discharge.
* The applicant must have served at least 90 days or more during wartime or 181 continuous days or more during peacetime.
For most veterans on active duty today and for many who have retired or separated, the following rules also apply:
There is a two-year duty requirement for those who served
* As an enlisted member after September 7, 1980.
* As an officer after October 16, 1981.
For all who joined after these dates, VA regulations require;
* 24 continuous months of active duty military service.
* The full period for which called or ordered to active duty, but not less than 90 days (any part during wartime) or 181 continuous days during peacetime operations.
These rules mean brand-new recruits, basic trainees and recent graduates of military technical school programs are not eligible for a VA loan…yet.
New recruits and basic training graduates who want a VA home loan should begin working on their credit history between the time they join the service and the time they become eligible for a VA loan so that when the time comes the military member is completely ready to apply for a VA guaranteed mortgage.
RELATED ARTICLES:
VA loans don’t always involve a single borrower. Sometimes there are situations where co-borrowers, co-signers, and joint loan applicants want to apply for a VA guaranteed mortgage loan.
There are a great many commonly asked questions about VA home loans, but one of the most-asked topics revolves around the issue of VA loan eligibility. One important issue connected to eligibility is the nature of an applicant’s military discharge.
The VA home loan program is not the only type of government insured mortgage loan program. There are other programs available which, unlike VA loans are open to the general public.
The VA Interest Rate Reduction Refinance Loan program (abbreviated as VA IRRRL) does require a VA loan funding fee. But, borrowers eligible for a this exemption should not assume that it is automatic.
The VA Interest Rate Reduction Refinance Loan program (abbreviated as VA IRRRL) does require a VA loan funding fee. But, borrowers eligible for a this exemption should not assume that it is automatic.
