Steps to Buying a Home With a VA Loan

Steps to Buying a Home With a VA Loan

VA loans are the most suitable mortgage option available for veterans, active military members, and surviving spouses. VA loans offer several significant financial advantages over traditional mortgages. Due to these advantages, VA loans have grown significantly in volume over the past 15 years.

The use of VA loans has increased since the Great Recession, and they are arguably one of the best mortgage products for military members. While the VA loan process has a reputation for taking too long, the process is generally the same as for other loans, and VA loans are typically approved and closed in 30 to 45 days. Both the borrower and the lender play a role in the length of time it takes from start to close.

Here are the steps to the VA Home Buying Process.

Step 1: Check Your VA Eligibility

The first thing you’ll need to do is see if you are eligible for a VA home loan and obtain a Certificate of Eligibility (COE). The COE can only be obtained from the VA. These certificates are available to veterans, active duty guards, reserve, and spouses of active-duty military personnel. An individual needs a COE to apply for a home loan, but it does not guarantee that the applicant will be approved.

Service Requirements for Veterans and Active Military

The following table specifies the eligibility requirements for veterans and active military members.

When did you serve? Serving at least this amount of time meets the minimum active-duty service requirement:
September 16, 1940, through July 25, 1947 (WWII)
  • 90 total days, or
  • A service-connected disability discharged after 90 days
In the post-WWII period (July 26, 1947 – June 26, 1950)
  • 181 continuous days, or
  • In the case of a disability-related discharge, less than 181 days
From June 27, 1950, to January 31, 1955 (Korean War)
  • 90 total days, or
  • If you were injured while on duty, you must have served less than 90 days
During the post-Korean War period (between February 1, 1955, and August 4, 1964)
  • 181 continuous days, or
  • In the case of a disability-related discharge, less than 181 days
A time period between August 5, 1964, and May 7, 1975 (Vietnam War)
If you served in the Republic of Vietnam from February 28, 1961, to May 7, 1975
  • 90 total days, or
  • Discharged for a service-connected disability in less than 90 days
During the post-Vietnam War period, between May 8, 1975, and September 7, 1980, or
During the period of May 8, 1975, through October 16, 1981, if you served as an officer
  • A continuous period of 181 days
  • if you were discharged due to a service-connected disability less than 181 days
On or before August 1, 1990, or between September 8, 1980, and August 1, 1990
During the period of October 17, 1981, through August 1, 1990, if you were an officer
  • The equivalent of 24 consecutive months
  • Active duty for the entire period (at least 181 days)
In the period between August 2, 1990, and the present (Gulf War)
  • 24 continuous months, or
  • The entire period (at least 90 days) for which you were called or ordered to active duty, or
  • A minimum of 90 days if you were discharged because of hardship, a reduction in force, or the convenience of the government
  • If you were released because of a service-connected disability, you could return within 90 days
Your service ended after September 7, 1980, or
Those who served as officers after October 16, 1981
  • 24 continuous months, or
  • The entire period (at least 181 days) for which you were called or ordered to active duty, or
  • A minimum of 181 days if you were discharged due to hardship, a reduction in force, or for government convenience
  • if you were discharged due to a service-connected disability, less than 181 days
I’m on active duty now
  • 90 continuous days

Service Requirements for National Guard and Reserves

The following table specifies the eligibility requirements for National Guard and reserves members.


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How long have you served? Active-duty service of at least this length of time meets the minimum requirement:
There has been a Gulf War since August 2, 1990 90 days of active duty
Any period of time

You have six creditable years of Reserve or National Guard service and match one of the descriptions below.

At least one of these must be true:

  • Discharged honorably, or
  • When you retired or when you
  • Transferred to the Selected Reserve as a result of honorable service or to another element of the Ready Reserve beside the Selected Reserve
  • Selected Reserve: continue to serve

Other Options if You Are Ineligible in the Above Ways

You may also be eligible for a VA loan if you are the unmarried spouse of a veteran who died while serving or has a service-connected disability. You may also qualify if you are the spouse of a service member who has been missing in action or taken as a prisoner of war.

Related Article: VA Loan Limits By State

Step 2: Apply for a Certificate of Eligibility

Obtaining a VA direct or VA-backed loan is only possible after applying for a Certificate of Eligibility.

Although you can begin speaking with potential lenders and getting an idea of what you might be approved for, you’ll need the COE to get a VA loan.

You can also begin the application process as soon as you have all the required documents.

  • Through the VA e-Benefits portal, VA COE applications can be submitted online.
  • A VA lender can provide the COE to veterans electronically.
  • VA Form 26-1880 should be used to apply by mail. Mail the form to the following address:
    PO Box 100023,
    Decatur, GA 30031

3. Get Preapproved for a Loan

Being preapproved for a loan means that you’ve taken the necessary steps to find out what you might qualify for and have all your ducks in a row before you begin looking for houses.

Having a preapproval for a loan also gives you an advantage when making offers on homes because your offer is not contingent on getting approved for funding.

Before you take steps to get preapproval, you’ll want to gather important documents and understand where you stand financially.

Know Your Credit Score

You’ll want to have a good idea of your credit score and credit history before applying for a VA loan. One benefit of a VA loan is its relaxed credit requirements, but you’ll still want a good credit score to be eligible for the best rates and terms.

Luckily borrowers do not need blemish-free credit reports or high credit scores to qualify for VA financing or receive favorable rates and terms. The purpose of VA loans is to provide simple and accessible mortgages to as many military buyers as possible. Therefore, no minimum credit scores are required, and each lender may have different requirements.

Documents Needed to Apply for a VA Loan

Aside from knowing your credit score, you should gather certain documents when preparing to apply for a VA loan. These documents include:

Identity Verification

You must verify your identity when applying for a VA mortgage. Your driver’s license, state identification card, or another government-issued identification must be provided as proof of your identity.

Related:How Do I Get a VA Certificate of Eligibility?

Certificate of Eligibility

As previously mentioned, to qualify for the VA’s home loan benefit, service members and veterans must provide proof of eligibility. Therefore, you need a Certificate of Eligibility to prove your eligibility to the Department of Veterans Affairs (VA).

An application for a loan does not require VA paperwork, and the lender will typically get this document for you once the loan process is underway.
The Certificate of Eligibility may require you to provide additional documentation based on your service history.

As a veteran, you will need a DD-214. Active-duty personnel will need a Statement of Service, and National Guard/Reservists will need a Points Statement.

With just some basic information, lenders can usually obtain your COE. To get your COE, please get in touch with your loan officer.

Income Documentation/Verification of Employment

The lender may require written or verbal confirmation of your employment when applying for a VA home loan. According to your financial situation, you may need any of these income documents.

  • W-2 statements and paystubs from the last two pay periods
  • Two years of federal tax returns, 1099s, commissions, and rental income from properties (from self-employment) using Form 1040 Schedule E.
  • A recent bank statement, retirement statement, or investment statement as applicable.
  • A VA disability award’s percentage.
  • Verification of Social Security income award letters as necessary.
  • If applicable, verification of child support and alimony.
  • Verification of liquid assets.

When you are ready to apply, there are several steps to take to get preapproval on a home loan.

1. Gather Your Financial Documents

To apply for preapproval, you’ll need a few financial documents – especially ones concerning your income, debts, and monthly expenses.

2. Choose a VA Lender

Choosing a VA mortgage lender is the next step. One can only obtain VA loans from a VA-approved mortgage company. You should choose one that specializes in VA loans, which will make the process easier and more efficient.

3. Fill Out an Application

You’ll need to fill out an application so the lender can assess your financial status and determine the terms and loan amount you qualify for.

Typically, you must provide information about your income, credit history, debts, and other financial matters when you fill out these forms. The same information is needed from your spouse if you’re applying for a loan with them. Your lender will use this information to assess your financial capabilities and risk as a borrower.

4. Obtain Your COE

While you can obtain your COE before applying with a lender, your VA lender can also handle this process for you if you prefer.

The COE must be obtained if you want to get a VA loan.

5. Consult a VA Loan Officer

A loan officer with the financial institution will give you the options available based on your application. In addition, they will explain what you qualify for in terms of interest rates, terms, and loan amount.

6. Receive Your VA Loan Preapproval Letter

Once your loan officer reviews all your information and agrees to the terms and other metrics you qualify for, you will receive a preapproval letter. The lender will indicate in the letter whether your loan is conditionally approved, as well as how much you may borrow. You can then use this number to set a budget and begin looking for a house.

Related Article: VA Loan Assumption: An Overlooked Benefit

Step 4: Find a Home

Once you are preapproved and know your budget, you can begin the home search.

You’ll need to find a real estate agent that can help you in your home search and who can fill out the necessary paperwork for you. Especially if this is your first time buying a home, you’ll want an expert to help guide you through this process.

Consult relatives, friends, and neighbors for recommendations on real estate agents. Then, choose an agent after meeting with several.

In most cases, it’s the seller who will pay realtor fees, but you should still ensure you understand all fees, commissions, charges, and your obligations as a buyer before choosing an agent.

Once you’ve selected a realtor, give them the criteria you’re looking for in a home and your budget, and let them go to work finding you the perfect home. Do not be discouraged if it takes a while to find your home, as this process can take several months and even years, depending on the market.

Related Article: VA Loan Calculator

Step 5: Make an Offer on Your Home

Once you’ve found a home you like, you’ll need to make an offer on the house.

The offer includes the price you’re willing to pay, things you’re hoping to include in the purchase, and any terms you’d like to have in the purchase agreement. You also may need to negotiate with the seller to come to terms that both parties can agree on.

Your realtor will walk you through the process of making an offer, make recommendations on the terms and price you should offer and will fill out and submit any necessary paperwork.

Related Article: How Many VA Home Loans Can You Have?

Step 6: Appraisal and Inspection

Once a seller has accepted your offer, there are a few steps you’ll need to take before closing on your new home.

First, it is recommended that you have the home inspected before purchasing it to check for significant defects. Then, if there are issues, resolving them or an adjustment in purchase price can potentially be negotiated with the seller.

You’ll also need to have a VA-approved appraiser come and appraise the home to determine whether it meets basic property standards (MPRs or minimum property requirements). The appraisal will also determine whether the home is worth the purchase price and offered loan amount.

You have a few options if your property doesn’t appraise for a high enough value to qualify for the loan.

One option is requesting a reevaluation of value (ROV). If you can provide the lender with valid sales data showing that the property is worth more than its appraised value, the lender will ask the appraiser to reconsider or get a second opinion.

Another option is to negotiate a new price for the sale. In this case, the seller would have to agree to match the appraised value as the sale price.

Lastly, if you have the difference between the appraised price and the sale price in cash or other funds, you could pay the difference.

Step 7: Close On Your New Home

Once the above steps are completed and everything is agreed upon, it’s time to close on your new home.

Closing is typically held at a small company, escrow office, or attorney’s office. Before signing, read everything carefully to understand the terms and conditions of the sale fully. There are dozens of pages to sign, and you must understand this legally-binding document.

It is advisable to have another person accompany you to the signing and closing process to help ask questions and be a second set of eyes for the documents being signed.

Once you’ve signed and closed on your new home, you’ll receive the keys and can begin moving in.

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