Meet the VA’s and lender’s standards of credit, income, etc.,
Live in the home the loan is for.
What are the advantages of getting a Cash-Out Refinance Loan?
A Cash-Out Refinance Loan may help service members:
Take out cash from their home equity to use for other expenses such as to pay off debt, tuition, home improvements, etc.,
Refinance a non-VA Home Loan into a VA Home Loan.
Do I have to make a down payment for a Cash-Out Refinance Loan?
No. There is no requirement for service members to make a down payment on a Cash-Out Refinance Loan.
However, the Federal Housing Financing Agency (FHFA), has loan limits for mortgages. Under a Cash-Out Refinance Loan, service members may borrow up to the limit without making a down payment. If they make a down payment, they may be able to borrow more than this amount. Learn about VA Home Loan limits.
Do I pay closing costs on a Cash-Out Refinance Loan?
Loan discount points or funds for temporary “buydowns”
Credit report and payment of any credit balances or judgments
VA appraisal fee
Hazard insurance and real estate taxes
State and local taxes
Title insurance
Recording fee
How do I get a Cash-Out Refinance Loan?
1. Find a lender
Service members will need to find a private bank, mortgage company, or credit union to get a Cash-Out Refinance Loan. The terms and fees will vary, it is recommended to contact several lenders.
Service members should be able to use their original Certificate of Eligibility from their first VA Home Loan to show their lender. For service members that cannot find their COE, they may request the lender to get their COE electronically through the VA Home Loan program portal.
Service members who are applying for the first time for a VA Home loan will have to apply for a Certificate of Eligibility.
3. Gather necessary documents for the lender and the VA.
Lenders will also need:
Copies of paycheck stubs for the most recent 30-day period,
W-2 forms for the previous 2 years,
A copy of your federal income tax returns for the previous 2 years (required by many, but not all lenders), and
Any other information the lender requires.
4. Follow the lender’s process for closing the Cash-Out Refinance Loan and pay closing costs.
Service members may need to pay a VA funding fee to close on the loan. Their lender will also charge interest on the loan in addition to closing costs.
Where can I learn more about VA Home Loans?
The VA’s Home Loan page has dedicated information, resources, and guidance for how to get and use a VA Home Loan.
The service member will use the IRRRL on an existing VA Home Loan,
The service member can show that they are living in the home covered by the loan, and
The VA Home Loan must become the primary mortage (for when there is a second mortage on a home already).
What are the advantages of getting an Interest Rate Reduction Refinance Loan?
An IRRRL may help service members:
Lower their monthly loan payment by getting a lower interest rate,
Make their monthly loan payment more stable by moving from a loan with an adjustable or variable interest rate (an interest rate that changes over time) to one that is fixed (the interest rate stays the same).
Do I have to make a down payment for an Interest Rate Reduction Refinance Loan?
No. There is no requirement for service members to make a down payment on an IRRRL.
However, the Federal Housing Financing Agency (FHFA), established conforming loan limits for mortgages. Under an IRRRL, service members may borrow up to the limit without making a down payment. If they make a down payment, they may be able to borrow more than this amount.
Do I pay closing costs on an Interest Rate Reduction Refinance Loan?
Loan discount points or funds for temporary “buydowns”
Credit report and payment of any credit balances or judgments
VA appraisal fee
Hazard insurance and real estate taxes
State and local taxes
Title insurance
Recording fee
In cases where an IRRRL is used to get a bigger loan for a different home, the seller pays these closing costs:
Commission for real estate professionals
Brokerage fee
Buyer broker fee
Termite report
How do I get an Interest Rate Reduction Refinance Loan?
1. Find a lender.
Service members will need to find a private bank, mortgage company, or credit union to get an IRRRL. The terms and fees will vary, it is recommended to contact several lenders.
2. Gather necessary documents for the lender and the VA.
Service members should be able to use their original Certificate of Eligibility (COE) from their first VA Home Loan to show their lender. For service members that cannot find their COE, they may request the lender to get their COE electronically through the VA Home Loan program portal.
3. Follow the lender’s process for closing the IRRRL and pay closing costs.
Service members may need to pay a VA funding fee to close. Their lender will also charge interest on the loan in addition to closing costs.
With an IRRRL these costs may be included in the new loan, so, the service member does not have to pay up front. Otherwise, the lender might increase the interest rate, so the lender pays the closing costs instead.
Where can I learn more about VA Home Loans?
The VA’s Home Loan page has dedicated information, resources, and guidance for how to get and use a VA Home Loan.
This loan is like a Purchase Loan offered to eligible service members and veterans through the Department of Veterans Affairs (VA). However, not all lenders are able to make loans for properties on federal trust land, ask before selecting a lender.
What are the benefits of a Native American Direct Loan?
How does the Native American Direct Loan work with Native Tribes?
Native American Tribes or other sovereign governing bodies first enter a Memorandum of Understanding (MOU) with the VA. Once the MOA has been agreed on, the service member may apply for a NADL loan.
The NADL program is a loan and not a grant, the borrowed money needs to be paid back to the lender.
For properties not located on federal trust land, a different type of VA loan may be used to purchase, improve, or build a property.
What is a Memorandum of Understanding used for?
An MOA is an agreement between a Tribe and the federal government. In this agreement, the Tribe is made responsible for entering into a lease agreement for the land where the property is located or where it is going to be built. An MOA also authorizes loan officials to enter the land for appraisal purposes. The MOA also states Tribal foreclosure rules for the lender.
Which Native American Tribes have a Memorandum of Understanding with the VA?
The VA has a map of the United States where users can click on each state to see which tribes already have an MOU with the VA.
MOAs are also available to Natives of Hawaiian Homelands, American Samoa, Commonwealth of the Northern Marianas, and Guam.
Which Tribes in Arizona have a Memorandum of Understanding with the VA?
The following Arizona Native Tribes have a MOU with the VA:
Hualapai Indian Nation;
Colorado River Indian Tribes;
San Carlos Apache Tribe;
Gila River Indian Community;
Yavapai-Apache Nation;
White Mountain Apache Tribe;
Fort Mojave Indian Tribe;
Navajo Nation;
Hopi Tribe;
Pascua Yaqui Tribe; and
Salt River Pima-Maricopa Indian Community.
What if my Tribe does not have a Memorandum of Understanding?
If a service member is a member of a tribe without a MOU and want to use the Native American Direct Loan program, they may contact their regional loan center.
Who is eligible for the Native American Direct Loan program?
Native American service members or a non-Native American service member who is married to a Native American may be eligible for a NADL if they meet these requirements:
The tribal government has an agreement—or Memorandum of Understanding (MOU)—with the VA detailing how the program will work on its trust lands;
The veteran has a valid VA home loan Certificate of Eligibility (COE);
The veteran has a good credit score;
The veteran makes enough money to cover the mortgage payments and other costs of owning a home; and
The veteran will live in the home they are using the NADL to buy, build, or improve.
Service members eligible for NADL may have to pay a VA funding fee. This is a one-time fee that supports the program. Some service members or their spouses might be able to get this fee waived. The lender will also charge interest on the loan in addition to closing fees.
What if I have more questions?
An NADL coordinator can be emailed at This email address is being protected from spambots. You need JavaScript enabled to view it. or by phone at 888-349-7541
Available Monday through Friday, 8:00 am to 6:00 pm ET.
Veteran Affairs (VA) Home Loans are a benefit for service members, veterans, and their spouses to who want to buy, improve, or build a home. For any VA home loan applicant, they need to get a Certificate of Eligibility (COE) to begin an application.
What is a Certificate of Eligibility and why do I need one?
A Certificate of Eligibility is a document from the VA that confirms that the service member or veteran can get a VA home loan. By having a COE the service member proves to a lender that they qualify based on their history and duty status.
A COE also includes the VA loan entitlement. Loan entitlement is the amount the VA will pay back the lender in case the service member can no longer pay for the house.
Those eligible will get a COE to show their lender.
What documentation do I need to get a Certificate of Eligibility?
To request a COE, service members need to show that they did not receive a dishonorable discharge and that they met the minimum active-duty service requirement based on when they served.
Veterans
The VA has specific service requirements for different periods of service. Review the VA’s table of service requirements for COE eligibility. Generally, a veteran is eligible if they served for at least 90 days of active duty.
Current service member
Service members who have been on active duty for at least 90 continuous days are eligible for VA home loans.
National Guard members are eligible after at least 90 days of non-training active-duty service.
Reserve members are eligible after at least 90 days of non-training active-duty service and were discharged honorably.
How do I request a Certificate of Eligibility?
A COE can be requested online or by mail.
An application for COE can be completed and submitted through eBenefits.va.gov.
To mail in an application, complete VA Form 26-1880 and mail to the correct regional office listed on the form.
For a COE service members must show evidence of:
Veteran
Copy of their discharge or separation papers (DD-214)
Current service member
A signed statement by the commander, adjutant, or personnel officer showing the service member’s:
Full name;
Social Security number;
Date of birth;
Date they entered duty;
The length of any lost time; and
The name of the command supplying the information.
The VA has specific requirements for other eligible applicants such as:
Current or formerly activated National Guard member;
Current or formerly activated Reserve member;
Current member of the National Guard or Reserves who has never been activated;
Discharged member of the National Guard who was never activated;
Discharged member of the Reserves who was never activated; and
Can I get a Certificate of Eligibility as the spouse of a Veteran?
Spouses of veterans who meet one of the following descriptions may be eligible for a COE:
The veteran is missing in action;
The veteran is a prisoner of war (POW);
The veteran died serving or from a service-connected disability and the spouse did not remarry;
The veteran died serving or from a service-connected disability and the spouse did not remarry before they were 57 years old or before December 16, 2003; or
The veteran had been totally disabled and then died, but their disability may not have been the cause of death (in certain situations).
Depending on whether the spouse receives Dependency & Indemnity Compensation (DIC) or not, there are two methods for spouses to request a COE.
The Department of Veterans Affairs (VA) mission is to serve service members. One way they do this is by offering home loans that consider the needs of military families.
Is the VA a lender?
In most cases, the money for the loan does not come from the VA. All VA Home Loans can be categorized as one of the following:
For VA Direct Home Loans, the VA does act as the lender. This means they will work directly with the service member to manage the loan. For instance, the Native American Direct Loan (NADL) program is a VA Direct Home Loan.
With a VA-Backed Home Loan the VA does not act as a lender. Instead, the VA is there to guarantee a percentage of the loan to the lender in case the service member cannot repay the loan. VA-Backed Home Loans are the most common type of VA loan service members get since it gives favorable terms to work with private lenders such as a bank, mortgage company, or credit union.
For the rest of the article, VA Home Loans refers to VA-Backed Home Loans.
What is a VA Home Loan?
A VA Home Loan may provide better financing terms for service members and their family. VA Home Loans are made through private lenders such as banks, loan associations, or even mortgage companies. If the loan is approved by the lender, the VA guarantees a portion of the loan, allowing the lender to give the service member a better rate.
VA Home Loans may be used to buy, build, repair, retain, or adapt a service member’s home.
The VA Home Loan program charges a one-time funding fee. Certain veterans and service members are exempt from paying the funding fee. Members of the military community that are not exempt may pay this fee at closing or include it in their loan.
Reusable Benefit:
Members of the military community may use the benefit more than once if eligible.
Minimum Property Requirements:
VA loans have minimum property requirements to ensure the home is safe, sound, and sanitary.
No Penalty for Prepayment:
There is no penalty for making additional payments to the loan. Paying the loan earlier saves the borrower money because they do not have to pay interest for as long.
Assemble Mortgage:
When the service member sells their home, they may choose to have VA-eligible buyers take over the home loan. The qualifications of the buyer will be reviewed and approved by the VA or the lender.
VA Staff Assistance:
Service members who are having a temporary financial difficulty, the VA has loan technicians who may assist with the member’s specific situation.
Will I have to pay a VA funding fee?
Service members, veterans, or spouses who meet the following do not have to pay a VA funding fee:
Receiving VA compensation for a service-connected disability, or
Eligible to receive VA compensation for a service-connected disability, but they are getting retirement or active duty pay instead, or
The surviving spouse of a Veteran who died in service or from a service-connected disability, or who was totally disabled, and they are receiving Dependency and Indemnity Compensation (DIC), or
A service member with a disability rating, before being discharged and before the loan closing date, saying they are eligible to get compensation because of a disability claim, or
A service member on active duty who, before or on the loan closing date, received the Purple Heart.
Who is eligible for a VA Home Loan?
VA Home Loans are available to eligible members of the military community such as service members, veterans, members of the National Guard and Reserves, and military spouses. Any service member that has been dishonorably discharged may not receive the VA Home Loan benefit. To find out more about upgrading a discharge status, visit Veterans’ Consortium Pro Bono Discharge Upgrade Program
A Purchase Loan can help service members buy a home at a competitive interest rate. In most cases, service members do not have to make a down payment or buy mortgage insurance to obtain a purchase loan.
Service members and veterans can obtain a lower interest rate by refinancing your existing VA loan. They may also refinance a VA adjustable-rate mortgage (ARM) into a fixed rate mortgage.
For service members and veterans who would like to refinance their mortgage so they can pay other debt, pay for school tuition, or make home improvements, then VA’s Cash-Out Refinance Loan may be an option. The Cash-Out Refinance Loan may also be used to refinance a non-VA loan into a VA loan. VA will guarantee loans up to 100% of the value of their home.
The VA also offers two other types of loans for housing purposes.
The NADL program helps eligible Native American Veterans finance the purchase, construction, or improvement of homes on Federal Trust Land, or to reduce the interest rate on an existing NADL. These loans are only available if a memorandum of understanding exists between the Tribe organization and VA.
Service members or veterans with service connected, physical disabilities may be entitled to grant funds. Three different grant types may be used to buy, build an adaptive home, or modify an existing home to meet their needs.
Can I use my VA Home Loan benefit more than once?
Eligible members of the military community may use their VA benefit more than once if they “restore” their entitlement. An entitlement is the amount the VA will pay back the lender in case the service member can no longer pay for the house. Typically, the VA attempts to make entitlements that cover 25% of a loan.
If a service member already has a VA loan, an entitlement amount is provided on their Certificate of Eligibility which is how much the VA will guarantee to the lender. This entitlement is being used until the loan is paid back.
To restore entitlement, one of the following must be true:
The home was sold, and the prior loan repaid in full,
A qualified veteran agreed to take over the loan, or
The prior loan has been paid in full, but the home bought with that loan has not been sold (this can only be done once).
To request an entitlement restoration, a copy of a Request for a Certificate of Eligibility needs to be completed and sent to the VA regional loan center of the service member’s state.
There may be lending limits depending on how much the service member or veteran is eligible for a VA loan entitlement. The entitlement amount will vary depending on the cost of homes in an area.
Lending limits are tied to the loan entitlement amount a service member receives, meaning that the more entitlement a service member is eligible for, the more money they can borrow from a lender.
With full entitlement
Service members and veterans who have done one of the following are eligible for higher lending limits with VA loans:
They have never used their home loan benefit,
They have paid an earlier VA loan in full and sold the property (in this case, they would have their full entitlement restored), or
They have used their home loan benefit but had a foreclosure or compromise claim (also called a short sale) and repaid the VA in full.
Not having a loan limit does not mean that a loan of any amount can be taken out. Lenders will still consider a service member or veteran’s credit history, income, and assets when deciding how large of a loan the service member can afford.
With partial entitlement
Service members who already used their entitlement over a VA Home Loan may be eligible for another loan, but they are given a smaller entitlement amount. By having a smaller entitlement amount this means that the loan limit should be smaller.
Service members or veterans may have partial entitlement if any are true:
Have an active VA loan they are still paying back,
Paid an earlier VA loan in full and still own the home,
Refinanced their VA loan into a non-VA loan and still own the home,
Had a compromise claim (or short sale) on an earlier VA loan and did not repay the VA in full,
Had a deed in lieu of foreclosure on an earlier VA loan (this means they transferred their home’s title to the bank that holds the mortgage to avoid foreclosure), or
Had a foreclosure on an earlier VA loan and did not repay the VA in full
While the VA may allow a service member to use their partial entitlement left for a second loan, a lender may approve a service member for a loan bigger than the lending limit connected to the entitlement given by the VA. In this case, the VA will guarantee only the amount of the partial entitlement.
Do I need a certain credit score to qualify?
There is no minimum credit score required by the VA, but some lenders may have credit score requirements. Be sure to contact different lenders about any credit requirements.
Do all lenders offer a VA Home Loan?
Not all lenders have dedicated lending options for service members. To know which lenders do work with the VA ask them directly.
Do I have to live in the home I buy with a VA Home Loan?
VA Home Loans are designed to be used as a service member or veteran’s primary home. However, there are options for when a service member cannot live in the home because of deployment, having received Permanent Change of Station orders, or because the house needs repairs.
Primary Residence Requirement
When applying for a VA Home Loan, the applicant must show that they intend to live in the property as their home. Second homes or investment properties do not qualify for a VA loan.
Spouse Occupancy
The service member or veteran’s spouse can meet this requirement of the VA Home Loan by living in the home while the member is deployed or has long distance employment.
Dependent Occupancy
A dependent child may live in the home while their parent is away on active duty. However, an attorney or the legal guardian of the child needs to certify that they are living in the home. Some lenders may disagree on whether a dependent occupancy meets the VA Home Loan requirement.
Retirement Occupancy
Veterans who are retiring within 12 months from when applying for a VA Home Loan need to include a copy of their retirement application and documentation of requirement stability. Retiring veterans may apply to not move into the home right away for up to 12 months.
Delayed Occupancy
For borrowers who were delayed moving into a property because of repairs, their occupancy requirement may be considered delayed. They must agree to live on the property as soon as the improvements are completed.
Part of the requirements of a VA Home Loan is that the service member or veteran moves into the property within 60 days of when the loan closes.
Besides the exceptions listed above, the VA may waive the 60 days occupancy requirement if:
The service member or veteran can show that they will live in the home on a specific date after the VA loan closes, and
There is a specific event in the future that will make it possible for a member to live in the home on that date.
Typically, the VA does not give exceptions that are longer than 12 months after the loan closes.
What happens if I do not live in the home?
Lenders make sure the borrower (service members) meets and continues to meet VA Home Loan requirements. The VA’s role is to guarantee the loan and to select who is eligible for that benefit by awarding COEs.
The VA does not look over occupancy requirements. Lenders decide what type of consequences may be taken. Since the VA’s primary role is to guarantee the loan, they may no longer support the service member by guaranteeing the loan to the lender.
Can I get a VA Home Loan to buy a home in a foreign country?
Are there rules for what type of property I can buy?
VA Homes Loans can be used to buy condos, manufactured homes, and multifamily homes (as primary residences). However, loans may not be issued for manufactured homes; the service member would have to ask the lender.
The VA keeps a list of approved condos complexes. If the condo complex is not listed on the site, then it needs to be submitted to the VA for review to make sure it meets all VA requirements.
Can I build a home with a VA Home Loan?
Yes, a VA Home Loan can be used to build a home. However, there are more requirements for the construction to be eligible.
Can someone co-sign a VA Home Loan?
Yes. Other people may sign a VA Home Loan with a service member. However, the VA only guarantees the service member’s part of the loan. Unless the other person is the service member’s spouse, then a civilian’s part of the loan is not covered by the VA. Joint loan applications should be discussed with the lender to check for eligibility.
What happens if I divorce while on a VA Home Loan?
Unless the house is refinanced with a different loan, the civilian spouse would be in violation of VA occupancy regulations if they get the house in a divorce. If the spouse stays in the home, while making payments on the VA loan, the service member or veteran will not be eligible for another VA loan. Once the spouse pays off the VA loan or refinances, the veteran or service member may then reapply.
It may be possible for the service member or veteran to refinance to buy the share of the house from the ex-spouse.
If I pass away before the loan is paid off, will the VA pay the rest of the loan balance?
No. Surviving spouses or coborrowers have to continue to pay the loan. In cases where the service member was the only borrower on the loan, then the loan is the responsibility of the service member’s estate. Failure to pay the loan will result in foreclosure.
Can I be eligible for a VA Home Loan even if I had a previous bankruptcy or foreclosure?
VA Home Loan applicants are evaluated for risk and expected income. When underwriting the loan, past bankruptcy or foreclosure does not automatically disqualify an applicant. Lenders may still look at the reasons for bankruptcy and the type of bankruptcy.
Typically, there is a 2-year waiting period for Chapter 7 bankruptcy filing, a 1-year waiting period for a Chapter 13 filing, and 2-year waiting period for foreclosures to qualify for a VA Home Loan.
What can I do if I fall behind on my loan payments?
If the service member or veteran used a VA loan to buy the home, the VA can help with any delayed payments. Contact the VA at (877) 827-3702 to reach the nearest Loan Guarantee Office. The VA can provide a specialist to work with the lender and help explore all options to avoid foreclosure.
If a veteran or service member does not have a VA Home Loan, they may also call the same number for help.
Where can I learn more about VA Home Loans?
The VA’s Home Loan page has dedicated information, resources, and guidance for how to get and use a VA Home Loan.
