VA Loan Frequently Asked Questions

A home loan eligibility is based on service history and duty status. Veterans, active-duty service members, members of the National Guard and Reserve, and certain surviving spouses may qualify. Service requirements vary depending on when and how long you served. A Certificate of Eligibility (COE) confirms whether you meet the VA's service requirements for the home loan benefit.

Eligible borrowers may be able to purchase a home with a VA loan without making a down payment. VA generally does not require a down payment when the purchase price does not exceed the home's appraised value and the borrower has sufficient entitlement. However, a down payment may be required in some situations, such as when a borrower has only partial entitlement available or when the purchase price exceeds the appraised value.

The VA does not set a minimum credit score for VA-backed home loans. However, individual lenders may establish their own credit requirements. Credit is only one part of the qualification process; lenders also consider factors such as income, debts, payment history and the borrower's overall ability to repay the loan.

A Certificate of Eligibility (COE) confirms to a lender that you meet the VA's service requirements for the VA home loan benefit. It also provides information about your available entitlement. A COE does not guarantee loan approval; you must still meet applicable VA and lender requirements. In many cases, a lender can obtain the COE electronically on your behalf.

VA loan entitlement is the amount the Department of Veterans Affairs will guarantee on an eligible borrower's VA loan. Your entitlement helps determine how much VA guaranty is available to the lender. Borrowers with full entitlement generally do not have a VA-imposed loan limit, although they must still qualify for the loan. If you have used your VA benefit before and have not fully restored your entitlement, the amount of entitlement remaining can affect your financing options.

Yes. The VA home loan benefit is not necessarily a one-time benefit. Eligible borrowers may be able to use it again after selling or refinancing a home previously purchased with a VA loan. In some situations, entitlement can be restored, and borrowers with remaining entitlement may even be able to obtain another VA loan while a previous VA loan is still outstanding.

Yes, in some circumstances. A borrower who has remaining VA entitlement may be able to have more than one VA-backed loan at the same time. This can occur, for example, when a service member relocates but keeps a home financed with an existing VA loan. The amount of remaining entitlement, the new property's location and the borrower's qualifications can affect how much can be borrowed and whether a down payment is required.

No. VA-backed home loans do not require monthly private mortgage insurance (PMI), even when an eligible borrower purchases a home with no down payment. This can reduce the monthly housing expense compared with some other low-down-payment mortgage options. VA loans may, however, require a one-time VA funding fee unless the borrower qualifies for an exemption.

The VA funding fee is a one-time fee that applies to many VA-backed and VA direct home loans. The amount varies depending on factors such as the type of loan, down payment and whether the VA benefit has been used before. Certain borrowers are exempt from the funding fee, including some veterans receiving or eligible to receive VA compensation for a service-connected disability, certain surviving spouses, and qualifying active-duty Purple Heart recipients.

A VA appraisal is performed by a VA-assigned appraiser to estimate the property's value and determine whether it meets VA Minimum Property Requirements (MPRs). The appraisal helps confirm that the property is safe, structurally sound and sanitary, but it is not the same as a home inspection. Buyers should still consider obtaining an independent home inspection to evaluate the property's condition in greater detail.

Yes. Sellers may pay certain closing costs for a buyer using a VA loan, subject to VA guidelines. Sellers may also provide certain concessions, although VA places limits on some types of seller concessions. The amount and type of costs a seller can pay depend on the transaction, so the purchase contract and loan should be reviewed carefully.

Yes, potentially. A VA loan may be used to purchase an eligible condominium or a property with up to four residential units, provided VA requirements are met. For a multi-unit property, the borrower generally must occupy one of the units as a primary residence. Condominiums generally must be in a VA-approved condominium project or otherwise meet applicable VA approval requirements.

Generally, yes. A home purchased with a VA loan must be intended as the borrower's primary residence. VA occupancy requirements generally expect the borrower to occupy the property within a reasonable time after closing, typically within 60 days. Exceptions may be possible in certain circumstances, including some situations involving deployment, retirement, repairs or a spouse satisfying the occupancy requirement.

Yes, potentially. VA requires the borrower to intend to occupy the property as a primary residence when obtaining a VA purchase loan, but that does not necessarily mean the home must remain the borrower's primary residence forever. If circumstances change after satisfying the occupancy requirement, such as a military relocation or other move, the property may later be converted to a rental. Your existing VA loan, entitlement and plans for another VA-financed home should be reviewed before making the change.

A VA Interest Rate Reduction Refinance Loan (IRRRL), often called a VA streamline refinance, is available to eligible homeowners with an existing VA-backed home loan. An IRRRL may be used to refinance the current VA loan to potentially lower the monthly payment or make the payment more stable, such as by refinancing from an adjustable-rate mortgage to a fixed-rate mortgage. Eligibility, costs and lender requirements should be reviewed to determine whether an IRRRL provides a financial benefit.