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Service requirements for the VA loan get set by the Department of Veterans Affairs. However, these aren't the only requirements that determine your VA loan eligibility. Beyond the VA's service requirements, lenders have requirements borrowers must meet to get a VA loan.

Many borrowers are unaware the VA's requirements are mostly around service history, and the lender sets requirements for credit, income and debts - based on broad VA guidelines.

Who Qualifies For A VA Loan?

As for the service requirements for the VA loan, the VA requires prospective borrowers to meet one of the following:

  • Serve 90 consecutive days on active duty during wartime, or
  • Serve 181 days on active duty during peacetime, or
  • Serve 6 years in the Reserves or National Guard, or
  • Be the surviving spouse of a service member who died while serving or due to a service-connected disability.

However, a greater length of service is required for veterans who enlisted (and service began) after September 7, 1980 or entered service as an officer after October 16, 1981. These veterans must have completed one of the following:

  • 24 continuous months of active duty
  • Completed the full period for which called or ordered to active duty. (Still cannot be less than 90 days during wartime or 181 continuous days during peacetime.)

If you served less than the requirement with a discharge other than dishonorable, you still might be eligible. You can request a lender pull your Certificate of Eligibility (COE) to determine your status.

Speaking of your COE, if you are unsure of your status, you can start the VA loan process by contacting a lender and obtaining your COE. Contacting a lender for your COE clears up the difficult questions around overlapping service, or if basic training counted towards your eligibility.

For anyone else wondering the difference between wartime and peacetime, see the following breakdown:

Wartime Service (90 Consecutive Days)

War Date of Service
World War II September 16, 1940 — July 25, 1947
Korean Conflict June 27, 1950 — January 31, 1955
Vietnam Era August 5, 1964 — May 7, 1975
Gulf War August 2, 1990 — Present

Peacetime Service (181 Days)

Peacetime Period Date of Service
Post World War II period July 26, 1947 — June 26, 1950
Post Korean period February 1, 1955 — August 4, 1964
Post Vietnam period May 8, 1975 — August 1, 1990

Does Basic Training Count Towards my VA Loan Eligibility?

When considering the time in service requirements, we commonly get asked if basic training counts towards your 90 days of active-duty wartime eligibility. Basic training and AIT do not count towards the 90-day eligibility clock.

When Can I Use My VA Loan?

It's possible to use your VA loan benefit as soon as you meet the minimum service requirements of 90 consecutive days on active duty during wartime, or 181 days during peacetime, or six years in the National Guard or Reserves.

VA Loan Restrictions

The primary restriction with a VA loan relating to service is discharge status. Anyone discharged under dishonorable conditions is not eligible for a VA loan.

Basic VA Loan Guidelines

Beyond service requirements, the VA provides broad guidelines to lenders making VA loans.

From a high level, to get a VA loan, you must:

  • Be an eligible Veteran or military spouse with available VA loan entitlement.
  • Use the VA loans for an eligible purpose (homeownership).
  • Occupy, or intend to occupy the home within a reasonable time (typically within 60 days of closing).
  • Be an acceptable credit risk.
  • Have stable and sufficient income to make mortgage payments, pay debt obligations, cover the costs of owning a home and have enough left over for discretionary income after all major expenses.

Lenders typically have additional guidelines on top of these, known as lender overlays. For example, being an acceptable credit risk is too broad for a lender making the loan. The majority of lenders will want to establish a set credit score requirement.

Are There Any Other VA Loan Rules to Know?

There are no rules or requirements out of the ordinary. However, a couple of things borrowers often have questions on typically revolve around credit and income.

The VA doesn't require a specific credit score for Veterans and military members who want to use their VA loan benefit. But VA lenders typically will, and it varies by lender. That said, VA credit score requirements are often more lenient with the VA guarantee.

Similarly, lenders will compute debt-to-income (DTI) ratios. This measure is a snapshot of a borrower's monthly debts and payments compared to their gross monthly income. Despite the VA's preference for borrowers to have a 41 percent DTI ratio or lower, lenders will often allow for higher DTI ratios. That, too, can be different depending on the lender.

Are there Income Requirements with VA Loans?

VA loans have what's known as a residual income requirement. Residual income is your remaining cash after all major debts and obligations are paid.

Residual income is measured to ensure borrowers and their families will have enough money to cover basic living costs (e.g., food, transportation), and amounts vary based on family size and part of the country. The VA loan program's success in terms of low foreclosure rate is due in part to these residual income requirements.

What's the Best Way to See if I'm Eligible for a VA Loan?

The best way to determine if you are eligible is to start with a lender. Lenders can pull your Certificate of Eligibility in minutes to see if you meet the basic service requirements and have VA loan entitlement. Additionally, a lender can review your financial information to determine if you meet credit and income guidelines.

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ICB Solutions is a division of Neighbors Bank, which is an affiliate of Mortgage Research Center, LLC dba Veterans United Home Loans.

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