One of the most common questions asked by servicemembers is whether they’re eligible to obtain VA financing. VA eligibility is determined by the Department of Veterans Affairs and involves eligibility of the servicemember AND the property. As far as the servicemember is concerned VA requires an acceptable credit history (not credit perfection), adequate income and a Certificate of Eligibility. In addition, the servicemember must personally occupy the property.
In terms of property requirements, the VA loan may be used for the following purposes:
-Buy a home or a condominium unit in a VA-approved project
-Build a home
-Simultaneously purchase and improve a home
-Improve a home by installing energy-related features or making energy efficient improvements
-Buy a manufactured home and/or lot
Please note that to obtain a Certificate of Eligibility, the servicemember must have been discharged under conditions other than dishonorable. To obtain the Certificate of Eligibility check your applicable status, wartime and peacetime periods, qualifying active duty dates and minimum active duty requirements set forth below.
Servicemembers and Veterans
World War II
Qualifying Dates: 9/16/1940 – 7/25/1947
Minimum Active Duty Requirement: 90 total days
Post World War II
Qualifying Dates: 7/26/1947 – 6/28/1950
Minimum Active Duty Requirement: 181 continuous days
Korean War
Qualifying Dates: 6/27/1950 – 1/31/1955
Minimum Active Duty Requirement: 90 total days
Post-Korean War
Qualify Dates: 2/1/1955 – 8/4/1964
Minimum Active Duty Requirement: 181 Continuous Days
Vietnam War
Qualifying Dates: 8/5/1964 – 5/7/1975
(For Veterans who served in the Republic of Vietnam, the beginning date is 2/28/1961).
Minimum Active Duty Requirement: 90 total days
Post – Vietnam War
Qualifying Dates: 5/8/1975 – 9/7/1980
(The ending date for officers is 10/16/1981)
Minimum Active Duty Requirement: 181 continuous days
24 Month Rule
Qualifying Dates: 9/8/1980 – 8/1/1990 (The beginning date for officers is 10/17/1981)
Minimum Active Duty Requirement: 24 continuous months, OR the full period (at least 181 days) for which you were called or ordered to active duty
Gulf War (where service has ended)
Qualifying Dates: 8/2/1990 to present
Minimum Active Duty Requirement: 24 continuous months, OR the full period (at least 181 days) for which you were called or ordered to active duty
Currently On Active Duty
War: Any War except Gulf War
Qualifying Dates: Any
Minimum Active Duty Requirement: 90 continuous days
Gulf War
Qualifying Dates: 8/2/1990 to present
Minimum Active Duty Requirement: 90 days of active service
National Guard & Reserve Members
(Six years in the Select Reserves or National Guard, AND were discharged honorably, OR were placed on the retired list, OR transferred to standby Reserve other than Select Reserve or an element of Ready Reserve other than Select Reserve OR continue to serve in Select Reserve).
War: Gulf War
Qualifying Dates: 8/2/1990 to present
Minimum Active Duty Requirement: 90 days of active service
If you do not meet the minimum service requirements, you may still be eligible if you were discharged due to (1) hardship, (2) the convenience of the government, (3) reduction-in-force, (4) certain medical conditions, or (5) a service-connected disability.
Spouses
The spouse of a Veteran can also apply for home loan eligibility under one of the following conditions:
-Unremarried spouse of a Veteran who died while in service or from a service connected disability, or
-Spouse of a Servicemember missing in action or a prisoner of war
-Surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003. (Note: a surviving spouse, who remarried before December 16, 2003, and on or after attaining age 57, must have applied no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 6, 2003 that are received after December 15, 2004.)
-Surviving Spouses of certain totally disabled veterans whose disability may not have been the cause of death
Other Eligible Beneficiaries
You may also apply for eligibility if you fall into one of the following categories:
-Certain U.S. citizens who served in the armed forces of a government allied with the United States in World War II
-Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with World War II service, and others
Restoration of Entitlement
Veterans can have previously-used entitlement “restored” to purchase another home with a VA loan if:
-The property purchased with the prior VA loan has been sold and the loan paid in full, or
-A qualified Veteran-transferee (buyer) agrees to assume the VA loan substitute his or her entitlement for the same amount of entitlement riginally used by the Veteran seller. The entitlement may also be restored one time only if the Veteran has repaid the prior VA loan in full, but has not disposed of the property purchased with the prior VA loan. Remaining entitlement and restoration of entitlement can be requested through the VA Eligibility Center by completing VA Form 26-1880.
If you have questions about your VA eligibility or entitlement please contact us. We’ll gladly put our 23 years of experience to work on your behalf. We’ve helped vetarans obtain their entitlement, restore entitlement and appeal decisions where entitlement was denied. At Sidwell we’re not just a VA lender, we’re also an advocate for the servicemember.
Until the next post … may health and happiness abound!
