VA loan requirements: What you need to know

Quick insights

• To apply for a VA loan, you need to qualify for a Certificate of Eligibility (COE).
• Typically, there’s no minimum down payment requirement for VA loans.ec-va-gov-lgy-eligibility-toolkit
• Lenders set their own credit score and debt-to-income (DTI) ratio requirements for VA loans.va-loan-requirements-experian

If you’re a veteran, active-duty servicemember or eligible surviving spouse, a VA loan can be a powerful tool to help you purchase a home. Backed by the U.S. Department of Veterans Affairs, these loans offer perks, such as no down payment requirement, no monthly mortgage insurance payments and competitive interest rates.ec-va-gov-lgy-eligibility-toolkit However, before you apply, it’s important to understand the VA loan requirements.

Who is eligible for a VA loan?

If you became an active-duty servicemember on or after August 2, 1990, and performed at least 90 continuous days without a break in service, you are eligible for a VA loan.ec-eligibility-va-homeloan-prog Servicemembers on active duty before that date may have different requirements. National Guard members and Reserve members who don’t meet the active duty requirements may still be eligible to qualify for a VA loan, depending on how long they were enlisted.3 Surviving spouses may also be eligible. Check VA.gov for more details. 

If you believe you meet VA loan eligibility requirements, you’ll need a Certificate of Eligibility (COE) to prove to your lender you qualify based on your or your spouse’s service history.ec-eligibility-va-homeloan-prog

If you’re unsure or have questions regarding your eligibility for a VA home loan, please call your VA regional loan center.

How to request a COE

You can request a COE online through the VA website, or you can ask your lender to request the COE for you. You may need to supply supporting documentation to receive the COE, for example, your discharge or separation papers (DD214) or a statement of service signed by a commander, adjutant or personnel officer.ec-va-home-loan-coe

Surviving spouses

The process for requesting a COE is slightly different for surviving spouses depending on whether you’re receiving Dependency & Indemnity Compensation (DIC). If you aren’t receiving DIC benefits, you’ll need to apply for them first before requesting a COE. If you are receiving DIC benefits, you’ll need to fill out a Request for Determination of Loan Guaranty Eligibility—Unmarried Surviving Spouses (VA Form 26-1817).ec-homeloans-surviving-spouses Forms can be found at VA.gov.

VA loan requirements

If you’re eligible to apply for a VA loan, you’ll still need to meet some basic requirements to be approved.

• Credit score: The VA doesn’t require a minimum credit score. However, lenders have the freedom to set their own minimums.ec-va-gov-lgy-eligibility-toolkit A FICO score of 620 or higher is a common threshold.va-loan-requirements-experian. Talk to your lender to see what their minimum credit score is for VA loans.
• DTI ratio: Debt-to-income (DTI) ratio is one of the most important pieces of any home loan application. Lenders can set their own DTI minimums, but most prefer a DTI ratio of 41% or less.va-loan-requirements-experian Talk to your lender to find out their specific requirements.
• Residual: VA loans are unique in that they also use a residual qualifier. Residual income is the amount of disposable income a veteran has left each month after paying their mortgage, property taxes, insurance, utilities and household expenses. The residual is based on the loan size and number of dependents that will occupy the property.
• Down payment: There is no down payment required, so long as the sales price isn’t higher than the appraised value of the property.ec-va-purchase-loan-aug24
• Primary residence: You must live in the home you purchase with a VA loan.ec-va-purchase-loan-aug24
• Funding fee: The VA funding fee is a one-time payment on VA-backed loans to help lower the loan cost for U.S. taxpayers. The fee can be rolled into the loan or paid as part of your closing costs.ec-va-funding fee-loan-closing
• Closing costs: You will still need to be able to cover closing costs to qualify for a VA loan. Closing costs can vary significantly by lender, so it’s worth asking for an estimate.

Again, lenders can set their own requirements for minimum credit score and DTI ratio thresholds. The numbers above are provided for reference. You should ask your chosen lender about their specific requirements.

How to apply for a VA home loan

If you’re eligible for a VA loan and feel you can meet the approval requirements, here are the next steps to take:

1. Verify eligibility

If you don’t already have your COE, now’s the time to request it. This might require gathering supporting documentation, like the DD214. If you don’t want to request the COE yourself, you can have your lender do it for you. If you apply online or through your lender, you can get the COE almost instantly. If you apply by mail, the process can take a few weeks.ec-va-coe

2. Shop lenders

Lenders are free to set their own credit score and DTI ratio requirements for VA loans. That means you’ll likely see variations in these thresholds if you talk to different lenders. Lenders also offer different mortgage rates and charge different closing costs for VA loans. To get a sense for what your options are, and how much your loan will cost, it can be worthwhile to talk to multiple lenders.

3. Apply for preapproval

Once you’ve found the lender you’d like to use, you have the option to apply for preapproval. Securing preapproval can streamline the final loan application process and might make your offer stronger to potential sellers. That’s because it shows sellers you’ve been vetted by a lender and are likely to be approved for the mortgage loan.

If you decide to apply for preapproval, you’ll probably need to provide supporting documentation to your lender, such as a W-2 and pay stubs.

4. Start house hunting

Once you’re financially prepared to make your purchase, you’ll need to provide the lender with the property and purchase price to complete the mortgage application. This means finding a home and coming to terms with the seller. A real estate agent can be extremely helpful during this stage of the process.

In summary

If you’re eligible, VA loans are one of the only ways to purchase a home without a down payment. However, there are still some lender-specific requirements you’ll need to meet, like minimum credit score and DTI ratio. It’s likely worth your time to shop lenders to see what options are available.

VA loan specifics FAQs

Can you get a VA loan with bad credit?

“Bad credit” is a subjective term. FICO grades credit scores from 580–669 as “fair” and anything below 580 as “poor.”ec-good-cr-score-experian

Can I get more than one VA loan?

Yes, it’s possible to get multiple VA loans over your lifetime. If you use a VA loan to purchase a property and then sell it, you’ll get your full VA entitlement restored. That means you can use it again to purchase a new property.affordability-hl000008

If you own a home you purchased with a VA loan and still have payments, you could have some remaining entitlement. It may be possible to use the remaining entitlement to take out another VA primary residence home loan, provided you meet the lender requirements.ec-va-home-loan-limits

Are VA loans hard to qualify for?

“Hard” is a subjective term. Because it’s possible to get a VA loan without a down payment, it may remove an obstacle to buying a home for some applicants. However, you’ll still need to be eligible to apply and meet the other lender requirements, including affording the VA funding fee and closing costs.