VA Home Loan Information for First-Time Home Buyers

A VA home loan is a mortgage loan that is backed by the United States Department of Veteran Affairs (VA). The loan is available to eligible veterans of all branches of US military, veterans who served in Selected Reserves or the National Guard and the surviving spouses of eligible veterans. VA home loans are designed to aid veterans who have trouble qualifying for ordinary private mortgage loans. Veterans benefit from fairly generous loan limits and other terms, and the VA office staff can assist them every step of the way.

How VA Home Loans Work

Contrary to popular belief, VA home loans are not issued directly by the VA. Rather, the VA guarantees mortgage loans issued by private lenders. This ensures that the private lender doesn't lose money, should the borrower default. This, in turn, allows private lenders to offer more loans than would be typical.

The maximum VA Home Loan amount varies depending on the county. It is adjusted annually to keep up with changes in average annual income and other financial factors. VA home loans don't require a down payment, but the veterans will be able to borrow more if they do provide one.

Who Is Eligible

In order to qualify for a VA home loan, the applicant must fit one of the following categories:

  • Pre-1980 wartime veterans - veterans who had at least 90 days of active duty during World War II, Korean War and Vietnam War, and were honorably discharged. The 90 day requirement is waived if the veteran was discharged because of a service-related disability.
  • Pre-1980 peacetime veterans - veterans who served at least 180 days of active duty during peacetime between 1947 and 1980. As with veterans who served during wartime, the duration requirement is waived if the veteran was discharged due to a service-related disability.
  • Post-1980 veterans - veterans who served at any point between 1980 and the present. In order to qualify, they had to have served at least 24 months of continuous active duty or the full period for which they were called to active duty (at least 181 days). They had to have been honorably discharged. Just as before, the duration requirement is waived if discharged due to a service-related disability. The requirements for Gulf War veterans are slightly different - because of the duration of the war, the full service minimum is reduced to 90 days.
  • Non-active duty veterans - veterans who served in Selected Reserves or the National Guard for at least 6 years and were either honorably discharged, placed on the retired list or transferred to Standby Reserve.
  • Veterans' Spouses - a widowed spouse of a veteran who was killed in action, died of a service related disability, was missing in action or became a prisoner of war. Spouses who remarried before December 16, 2003 are ineligible for the VA home loan. However, they are exempt from this prohibition if they are 57 or older.

Required Documents

Before veterans apply for a VA Home Loan, they must obtain a Certificate of Eligibility, a document that verifies that they fall under one of the above-mentioned categories. They can do this by filling out the VA Form 26-1880 and submitting it to the VA.

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