How to Apply for a VA Loan while on Active Duty

When you apply for a VA loan, you can either be post-active duty or actively serving in the military. Your status will not affect your ability to get the guaranty. You will simply have to confirm your status as an active duty member of the military in order to get your certificate of eligibility for the loan, which is the first step to applying. While your status will not affect this step, it may affect the size of your guaranty and the limits of the mortgage you can achieve.

Certificate of Eligibility Application

The first step in any VA loan is to assure you qualify with the Department of Veterans Affairs. You can do this step entirely online, and you need to gather only minimal materials to complete it. Simply go to the VA home loan website at homeloans.va.gov and find the Certificate of Eligibility: Veteran Registration User Guide. This has all of the steps to register. Even though it is specifically named the Veteran User Guide, there is an explanation of what to do if you are still serving. You will use your active duty service number instead of your discharge form to determine your eligibility.

Loan Application

A VA home loan is not an actual loan from the VA. It is insurance provided by the VA on a private loan to make that loan cheaper and more accessible. Once you have the certificate of eligibility, you will need to apply for the private loan. Applying with this certificate in hand will show your lender you qualified for the risk-reducing insurance on the loan, which will make your chances of getting a loan much higher than if you applied without the certificate.

Loan Processing

As an active member of the military, your position and income will be at times unstable. If you have not shown the ability to sustain a "real world" career, this can be troublesome to a lender. The lender would like to know you will continue to earn an income once your active duty is over. The guaranty can only partly overcome this challenge. In addition, there is always the chance you could be deployed if you are still active duty. This scares lenders who see a higher rate of missed payments or defaults when service members go abroad. Ultimately, your loan may be held up in processing as these answers are addressed. You may want to consider using a lender that has a record of extending loans to active service members to help overcome these delays.

Finalizing the Loan

When it comes time to finalize the loan contract, the lender will use your certificate of eligibility to finally secure the guaranty. This requires a second round of applications. The VA will want to appraise the property you are purchasing and carry out further due diligence on the lender. When you work with a VA-approved lender, this process is much smoother. There can still be minor delays, however; so be prepared for your loan to take longer in funding when you are adding in the additional element of a VA guaranty. Thankfully, the guaranty means you do not need to place a down payment, so the delay is worth the payoff.

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