What Do Veterans Need To Know About VA Home Eligibility?

After leaving the military, many veterans have a difficult time re-assimilating into civilian life. This is often true even for people who did not serve in active combat. One main reason for this is how different the employment relationship is in the military versus working in other fields. One way you can resume some semblance of normalcy and build your net worth is to purchase a home. Before you do this, you need to confirm VA home loan eligibility.

What Is a VA Loan?

This loan is backed by the Department of Veterans Affairs. It allows qualifying active service members and veterans to secure home loans at favorable terms. These are the main ways it stands out:

  • You do not pay private mortgage insurance, which could help you qualify for a bigger loan.
  • You can pay a down payment, but you are not obligated to do so.
  • Lenders are often more willing to be flexible with veterans on minor details.

What Makes Veterans Eligible for VA Home Loans?

The U.S. Department of Veteran Affairs makes all final decisions on who is eligible for a VA-backed loan and why. It has requirements related to service time and reasons for discharge. If you fail to meet these requirements, you might miss out on the opportunity to use a VA loan to buy your home. In some cases, you might be able to ask for a review or discharge upgrade.

The VA does often exercise some flexibility when issuing Certificates of Eligibility for VA loan purposes. For example, if you do not meet its service requirements, you might still earn eligibility for the following reasons:

  • You suffered a disability related to your military service.
  • You developed qualifying medical conditions.
  • You received a qualifying early out.
  • You experienced hardship.
  • You were discharged for the convenience of the government.

What If I Am Not a U.S. Veteran?

A well-kept secret is that U.S. veterans are not the only former military persons who can take advantage of VA loans. For example, if you are now a U.S. citizen but previously served in World War II for a military force aligned with the Armed Forces, you may receive a COE. Similarly, holding certain positions in qualifying organizations could also work in your favor:

  • Cadet at the Coast Guard Academy, Air Force or the United States Military
  • Merchant seaman during World War II
  • Midshipman of the United States Naval Army
  • Public Health Service officer
  • Officer of the National Oceanic and Atmospheric Administration

If you are ever in doubt as to whether you qualify for a VA loan, let the VA make that decision. Otherwise, you might talk yourself out of benefits that could have significantly improved your quality of life and personal opportunities. Whenever possible, appeal denials through avenues provided by the VA.

What About General Creditworthiness?

In addition to getting a COE from VA, you also need to work on your credit score. Building your credit history does take some time, but the work is well worth it. Here are a few steps you can take to speed up the process:

  • Check your credit score to see where you stand.
  • Check your credit report and query any discrepancies.
  • Consider automating your bill payments so you never miss a payment.
  • Reduce your spending and hold off on applying for any new credit.
  • Pay down your credit cards as much as possible.

At National Home Loans, our brokers can review your information to determine how much home you can afford and what your rates might look like. With this information, you can decide if you wish to start house hunting or keep working on your score. Start by requesting your rates.


Written By

John Giannattasio

John Giannattasio is an independent mortgage broker based in San Diego. He brings a wealth of diverse business knowledge and experience to his mortgage practice, which results in a stress-free, seamless, and strategic experience for his clients.

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