How to get a VA-backed home loan — service requirements, the Certificate of Eligibility, the funding fee and who is exempt, and what the lender and VA appraisal require
VA does not lend the money; it guarantees part of a loan made by a private lender, which lets eligible veterans, service members and some surviving spouses buy, build or improve a home with no down payment, no monthly mortgage insurance and limited closing costs. Eligibility turns on service: 90 continuous days for those still serving; for veterans, 90 days in a wartime period or 181 days in peacetime for older service, and since August 2, 1990, 24 continuous months, the full period of at least 90 days for which you were called to active duty, or less with a qualifying discharge; Guard and Reserve members qualify with 90 days of Title 10 active duty, certain Title 32 service, or six creditable years. The Certificate of Eligibility proves it to the lender. Most borrowers pay a one-time funding fee — 2.15% of the loan on first use with less than 5% down, 3.3% on later use, 1.5% with 5–10% down and 1.25% with 10% or more — unless they receive VA compensation for a service-connected disability or meet another exemption. The lender checks credit and income, VA appraises the home and applies minimum property requirements, and the home must be your residence.
What you'll need
- DD-214 (veterans), a statement of service signed by your command (current service members), or NGB-22 / points statement (Guard and Reserve)
- Certificate of Eligibility: request it online at VA.gov, through your lender's Web LGY access, or by mailing VA Form 26-1880 (surviving spouses use VA Form 26-1817)
- Income and credit documents the lender asks for (pay stubs, W-2s or tax returns, bank statements)
- If exempt from the funding fee: your VA award letter showing compensation for a service-connected disability
Step-by-step
Step 1: Check the minimum service requirement
Service members: at least 90 continuous days. Veterans, by period: September 16, 1940 – July 25, 1947, Korea (June 27, 1950 – January 31, 1955) and Vietnam (August 5, 1964 – May 7, 1975; November 1, 1955 – May 7, 1975 in the Republic of Vietnam): 90 total days; July 26, 1947 – June 26, 1950 and February 1, 1955 – August 4, 1964: 181 days; May 8, 1975 – September 7, 1980 (officers to October 16, 1981): 181 continuous days; September 8, 1980 – August 1, 1990 (officers from October 17, 1981): 24 continuous months or the full period of at least 181 days for which you were called; August 2, 1990 to the present: 24 continuous months, the full period of at least 90 days for which you were called or ordered to active duty, or 90 days if discharged under a qualifying exception. Less service counts if you were discharged for a service-connected disability. National Guard: 90 days of non-training Title 10 active duty, 90 days of active duty including 30 consecutive days under 32 U.S.C. 316, 502, 503, 504 or 505, or six creditable years; Reserve: 90 days of non-training active duty or six creditable years in the Selected Reserve. Qualifying exceptions include hardship, convenience of the government (at least 20 months of a 2-year enlistment), early out (21 months) and involuntary reduction in force.
Reference: https://www.va.gov/housing-assistance/home-loans/eligibility/
Step 2: Get the Certificate of Eligibility
Request the COE online at VA.gov (often issued immediately), ask your lender to pull it through VA's Web LGY system, or mail VA Form 26-1880 to the regional loan center address on the form. The COE shows your entitlement; with full entitlement there is no VA loan limit for a no-down-payment loan, and a borrower with remaining partial entitlement can borrow up to the conforming loan limit for the county without a down payment. Unmarried surviving spouses of veterans who died in service or from a service-connected disability, or who were rated totally disabled, request a COE with VA Form 26-1817.
Reference: https://www.va.gov/housing-assistance/home-loans/how-to-request-coe/
Step 3: Understand the funding fee
The one-time funding fee is based on loan type, down payment and whether you have used the benefit before: purchase or construction loans with less than 5% down — 2.15% on first use, 3.3% after; 1.5% with 5% to under 10% down; 1.25% with 10% or more down (any use). You are exempt if you receive VA compensation for a service-connected disability, are eligible for compensation but receive retirement or active-duty pay instead, receive DIC as a surviving spouse, have a proposed or memorandum rating before closing from a pre-discharge claim, or are on active duty with a Purple Heart. If VA later awards compensation with an effective date before closing, you can request a refund from your regional loan center. The fee can be paid at closing or financed into the loan.
Reference: https://www.va.gov/housing-assistance/home-loans/funding-fee-and-closing-costs/
Step 4: Choose a lender and get pre-approved
Any VA-approved bank, credit union or mortgage company can make the loan; VA sets no minimum credit score, but lenders set their own, and they verify income and residual income under VA's guidelines. Compare Loan Estimates from several lenders for rate, lender charges and closing costs — VA limits the lender's flat origination charge to 1% of the loan, and the seller may pay closing costs and up to 4% of the value in concessions. A written pre-approval based on verified income and credit tells sellers what you can finance.
Reference: https://www.va.gov/housing-assistance/home-loans/
Step 5: Appraisal, property requirements and closing
The lender orders a VA appraisal, which estimates value and checks VA's minimum property requirements (safe, structurally sound, sanitary); it is not a home inspection, so get one separately. If the appraisal comes in below the price, the contract's VA escape clause lets you walk away without losing earnest money, or you can renegotiate or pay the difference. You must certify that you will occupy the home as your residence. At closing you pay the funding fee (unless exempt), any closing costs not covered by the seller or lender credits, and nothing for mortgage insurance. Entitlement used on this loan is restored when the loan is paid off and the home sold, or once by refinancing it with another VA loan.
Reference: https://www.va.gov/housing-assistance/home-loans/
Critical tips
- The funding-fee exemption follows VA compensation for a service-connected disability at any rating, not a 10% threshold; bring the award letter to the lender.
- The VA Energy Efficient Mortgage lets you add up to $6,000 of energy improvements to the loan.
- If you fall behind on a VA loan later, call your servicer and VA's loan technicians at 877-827-3702; VA has programs to avoid foreclosure.
- Wounded Warriors runs a closing-cost assistance program for veterans buying with a VA loan; see warriorsfund.org/grants/housing for current eligibility.
- A county veterans service officer can help assemble service records for the COE: warriorsfund.org/find-cvso.