By Matt Allen
Vice President, Portfolio Lending (NMLS #415037);

How to Get a VA Loan

Apr 13, 2022

VA loan is an exclusive, low-cost loan that helps enlisted service members and veterans of the United States military achieve their dream of home ownership. However, some requirements must be met. This blog discusses how to get a VA loan and how your credit can impact your eligibility.

Determine your eligibility

Not everyone can get a VA loan, and certain criteria must be met. There’s a good chance you  qualify to receive VA benefits if you meet at least one of the following conditions:

  • You’ve served 90 consecutive days of active service during wartime
  • You have 6+ years of service in the National Guard or Reserves
  • You’re a U.S. citizen who has served in the armed forces of a government allied with the U.S. in World War II
  • You’ve served 181 days of active service during peacetime
  • You are the spouse of a service member who has died in the line of duty or because of a service-related disability
  • You’ve served as a member of certain organizations (public health service officers, cadets at the U.S. Military, etc.).

Select a VA-approved lender

Your best option is to choose a lender approved by the U.S. Department of Veterans Affairs. A lender with extensive knowledge of VA mortgages will ensure a quick and easy loan process. 

Obtain a Certificate of Eligibility

Before applying, you must prove your military or veteran status with a Certificate of Eligibility (COE). A  COE  indicates:

  • Your eligibility for a VA loan
  • The amount of guaranty (loan) you’re entitled to
  • How much of your VA entitlement you have already used

Your loan officer can assist you in obtaining your COE – you’ll need to provide your full name, Social Security Number, date of birth and military background.

If you are separated or retired from the military, you must also request a copy of your  DD-214 (Certificate of Release or Discharge from Active Duty). Keep in mind that this process could take as long as four weeks.

If you are currently in the Reserves or National Guard, you must provide a Statement of Service signed and dated by your Commanding Officer on official letterhead. This statement must include your name, date of birth, social security number and/or service number, enlistment date, statement that you are still on active duty, and the phrase “No Time Lost” (if applicable) or list the time lost.

How credit impacts your eligibility for a loan 

Credit history is a key factor determining your eligibility for a VA loan. Typically, you’ll need to maintain a score of at least 640 before applying. However, if you fall below that mark, we have other options for which you may qualify. Just remember: the better your credit score, the lower your interest rate. If you need help with improving your score, look at these six simple tips:

  1. Know your credit score. Your credit card company can often provide your score for free, or your bank should be able to provide it for a small fee.
  2. Get rid of as much of your credit card debt as possible. Try to keep your credit utilization ratio down to around 30 percent.
  3. Avoid worsening your credit during the application process. If possible, do not change jobs or make large purchases via credit, like financing a brand-new truck.
  4. Maintain steady employment. You must be able to hold and prove a reliable income, even if you’re self-employed. Your last two years of income should be at the same level or higher.
  5. Be diligent about paying your bills on time! Recent late payments can jeopardize your ability to qualify for a VA loan. We get it, you’re busy – set reminders or automatic payments to help stay organized.
  6. Have you had a recent foreclosure or bankruptcy? If so, you’ll typically need to wait at least two years from discharge/dismissal before applying for a VA loan (plus being able to demonstrate established credit following the foreclosure or bankruptcy). You may be eligible for a VA loan in the middle of Chapter 13 bankruptcy with at least one year of satisfactory payments made and approval of the trustee or bankruptcy judge.

Here's a calculator to help you determine your VA loan payments based on the purchased price, down payment, interest rate, military experience, and prior VA loan use. For more information on how to secure a VA loan, contact a NASB VA-approved lending officer at 1-844-334-4739 or visit here.