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Can I Get a VA Loan if I'm Unemployed?

Veterans who are retired or haven’t worked in a while may wonder if they can still get a VA loan without a steady income. The good news is Veterans can still access all of the benefits a VA loan offers as long as you meet the other lending criteria set forth by the VA and VA-approved lenders.

VA lenders typically focus on your ability to repay the loan. The borrower must be considered a satisfactory credit risk and have a current or anticipated income to apply to loan payments. At the end of the day, you don’t have to have a job to qualify for a VA loan as long as you can prove you can repay your debt.

Sources of Effective Income

VA lenders consider sources of income “effective” if they are stable and reliable, anticipated to continue for the foreseeable future and sufficient in amount.

A few sources of effective income an unemployed Veteran may receive include:

For these income streams to be counted as effective income, you must provide documentation proving the amount you have, along with proof that it will continue for at least three years.

Do Unemployment Benefits Count as Income?

If your unemployment compensation is a regular part of your income due to the nature of your work, it may count as income. Otherwise, temporary income cannot be considered toward your qualification for a VA home loan.

Can I Count My Spouse’s Income for a VA Loan?

Yes, you may include your spouse’s income as additional income when applying for a VA loan. This can allow you to qualify for a higher loan amount if your income isn’t steady. However, unless your spouse is a qualified Veteran, they cannot apply for a VA loan in your place.

Be Wary of Community Property States

In some states, spousal income and debt are equally considered for a home loan regardless if the spouse in question is on the loan or not. These are known as “community property states.”

In states where this is applicable, you must still jointly meet income requirements, and your spouse’s financial background will be evaluated whether or not you are applying solely. This can be more hurtful than helpful in many cases because lenders can count your partners’ debts against you.

We Aren’t Married, Can I Still Count Their Income For a VA Loan?

If you and your partner are not married but are both qualifying Veterans, you can apply as co-borrowers and purchase a home together with a VA Loan. If you and your partner are not married and only one is a qualifying Veteran, you’ll want to look into a joint VA loan.

Joint VA Loans

One significant benefit of a joint VA loan is that Veterans can take out a loan with a non-Veteran or non-spouse. A joint VA loan can be made with a friend, family member or significant other to whom you are not married.

However, joint VA loans come with additional stipulations to qualify, and the VA guaranty will only cover the Veteran’s portion of the loan. Also, the Veteran’s income must be enough to cover the non-Veteran’s portion of the loan if they default, which may be difficult if the Veteran is unemployed. The credit score of both the Veteran and non-Veteran must be satisfactory, which is typically a minimum credit score of 620.

The Bottom Line

Getting a VA loan while unemployed may be tricky, but it is by no means impossible. You can achieve this by leveraging your “effective income” and working closely with your VA lender to prove that you can make your monthly payments.