Using Your VA Benefits / Active & Prior Service
Benefits I Requirements I Q&A I Do You Qualify? I Contact Us
No Down Payment
You often have no up-front, out-of-pocket expenses with a VA loan. This is because a VA loan doesn't require a down payment and with a VA loan, the seller can pay the closing costs for you.
No Closing Costs
On a non-VA loan, you pay miscellaneous up-front fees, such as for processing or underwriting the loan. These fees can run around 3% of the loan amount equaling thousands of dollars. Most of the time on a VA Loan, you will not have to pay any out-of-pocket closing costs because the VA allows the seller to pay them for you.
Lower Interest Rates
VA loans often have lower interest rates than non-VA loans.
No Monthly Mortgage Insurance
Mortgage insurance can add up to a couple hundred dollars a month. VA guarantees the loan so you don't need mortgage insurance saving you money every month.
VA Appraisal
The VA assigns a VA licensed and qualified appraiser to estimate the value of the home you want to buy. The VA appraisers are chosen at random but on a non-VA loan, the lender usually can pick the appraiser they want to use. This could influence the appraiser to give an estimate that favors the lender and cost you more money in the end.
No Pre-Payment Penalty
Most loans, especially with less then perfect credit, will charge you high fees if you pay off your loan early. This happens if you refinance or sell your home. VA loans have no pre-payment penalty fees!
Assumable Mortgage
With a VA loan, you can transfer your mortgage to someone else. They would assume your mortgage. This can help sell your home, especially if the interest rate on your mortgage is less than the current interest rate.
Disabled Veteran
If you are 10% disabled or more, the VA waives the funding fee. Also, if you have a permanent and 100% service connected disability, you may be eligible for a $50,000 grant for adapting a home to accommodate your disability.
. Do You Qualify For A VA Loan?
REQUIREMENTS: (source: U.S. Department of Veterans Affairs)
Military Service Requirements for VA Loan Eligibility:
Note: Applications involving other than honorable discharges will usually require further development by VA. This is necessary to determine if the service was under other than dishonorable conditions.
Wartime - Service During:
WWII: 9/16/1940 to 7/25/1947
Korean: 6/27/1950 to 1/31/1955
Vietnam: 8/5/1964 to 5/7/1975
You must have at least 90 days on active duty and been discharged under other than dishonorable conditions. If you served less than 90 days, you may be eligible if discharged for a service connected disability.
Peacetime - Service during periods:
7/26/1947 to 6/26/1950
2/1/1955 to 8/4/1964
5/8/1975 to 9/7/1980 (Enlisted)
5/8/1975 to 10/16/1981 (Officer)
You must have served at least 181 days of continuous active duty and been discharged under other than dishonorable conditions. If you served less than 181 days, you may be eligible if discharged for a service connected disability.
Service after 9/7/1980 (enlisted) or 10/16/1981 (officer)
If you were separated from service which began after these dates, you must have:
Completed 24 months of continuous active duty or the full period (at least 181 days) for which you were ordered or called to active duty and been discharged under conditions other than dishonorable, or
Completed at least 181 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1171 (Early Out), or have been determined to have a compensable service-connected disability;
Been discharged with less than 181 days of service for a service-connected disability. Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances for the convenience of the Government.
Gulf War - Service during period 8/2/1990 to date yet to be determined
If you served on active duty during the Gulf War, you must have:
Completed 24 months of continuous active duty or the full period (at least 90 days) for which you were called or ordered to active duty, and been discharged under conditions other than dishonorable, or
Completed at least 90 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1173 (Early Out), or have been determined to have a compensable service-connected disability, or
Been discharged with less than 90 days of service for a service-connected disability. Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances, for the convenience of the Government.
Active Duty Service Personnel
If you are now on regular duty (not active duty for training), you are eligible after having served 181 days (90 days during the Gulf War) unless discharged or separated from a previous qualifying period of active duty service.
Selected Reserves or National Guard
If you are not otherwise eligible and you have completed a total of 6 years in the Selected Reserves or National Guard (member of an active unit, attended required weekend drills and 2-week active duty for training) and
Were discharged with an honorable discharge, or
Were placed on the retired list, or
Were transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable service, or
Continue to serve in the Selected Reserves
Individuals who completed less than 6 years may be eligible if discharged for a service-connected disability.
You May also be determined eligible if you:
Are an unremarried spouse of a veteran who died while in service or from a service connected disability, or
Are a spouse of a serviceperson missing in action or a prisoner of war
Note: Also, a surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003, may be eligible for the home loan benefit. However, a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must apply no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 6, 2003 that are received after December 15, 2004.
Eligibility may also be established for:
Certain United States citizens who served in the armed forces of a government allied with the United States in WW II.
Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with WW II service, and others.
. Do You Qualify For A VA Loan?
Q&A: (source: U.S. Department of Veterans Affairs)
Q: How do I apply for a VA guaranteed loan?
A: You can apply for a VA loan with any mortgage lender that
participates in the VA home loan program. At some point, you will need to
get a Certificate of Eligibility from VA to prove to the lender that you are
eligible for a VA loan.
Q: How do I get a Certificate of Eligibility?
A: Complete a
VA Form 26-1880,
Request for a Certificate of Eligibility: You can apply for a
Certificate of Eligibility by submitting a completed
VA Form 26-1880,
Request For A Certificate of Eligibility For Home Loan Benefits, to the
Winston-Salem Eligibility Center, along with proof of military service.
In some cases it may be possible for VA to establish eligibility without
your proof of service. However, to avoid any possible delays, it's best to
provide such evidence.
Q: Can my lender get my Certificate of Eligibility for me?
A: Yes, it's called Web LGY. Most lenders have access to the Web LGY
system. This Internet based application can establish eligibility and issue
an online Certificate of Eligibility in a matter of seconds. Not all cases
can be processed through Web LGY - only those for which VA has sufficient
data in our records. However, veterans are encouraged to ask their lenders
about this method of obtaining a certificate.
Q: What is acceptable proof of military service?
A: If you are still serving on regular active duty, you must include
an original statement of service signed by, or by direction of, the
adjutant, personnel officer, or commander of your unit or higher
headquarters which identifies you and your social security number, and
provides your date of entry on your current active duty period and the
duration of any time lost.
If you were discharged from regular active duty after January 1, 1950, a
copy of DD Form 214, Certificate of Release or Discharge From Active Duty
should be included with your VA Form 26-1880. If you were discharged after
October 1, 1979, DD Form 214 copy 4 should be included. A PHOTOCOPY OF
DD214 WILL SUFFICE.....DO NOT SUBMIT AN ORIGINAL DOCUMENT.
If you are still serving on regular active duty, you must include an
original statement of service signed by, or by direction of, the adjutant,
personnel officer, or commander of your unit or higher headquarters which
shows your date of entry on your current active duty period and the duration
of any time lost.
If you were discharged from the Selected Reserves or the National Guard, you
must include copies of adequate documentation of at least 6 years of
honorable service. If you were discharged from the Army or Air Force
National Guard, you may submit NGB Form 22, Report of Separation and Record
of Service, or NGB Form 23, Retirement Points Accounting, or it’s
equivalent. If you were discharged from the Selected Reserve, you may submit
a copy of your latest annual points statement and evidence of honorable
service. Unfortunately, there is no single form used by the Reserves or
National Guard similar to the DD Form 214. It is your responsibility to
furnish adequate documentation of at least 6 years of honorable service.
If you are still serving in the Selected Reserves or the National Guard, you
must include an original statement of service signed by, or by the direction
of, the adjutant, personnel officer, or commander of your unit or higher
headquarters showing the length of time that you have been a member of the
Selected Reserves. Again, at least 6 years of honorable service must be
documented.
Q: How can I obtain proof of military service?
A:
Standard Form 180, Request
Pertaining to Military Records, is used to apply for proof of military
service regardless of whether you served on regular active duty or in the
selected reserves. This request form is NOT processed by VA. Rather,
Standard Form 180 is completed and mailed to the appropriate custodian of
military service records. Instructions are provided on the reverse of the
form to assist in determining the correct forwarding address.
Q: I have already obtained one VA loan. Can I get another one?
A: Yes, your eligibility is reusable depending on the circumstances.
Normally, if you have paid off your prior VA loan and disposed of the
property, you can have your used eligibility restored for additional use.
Also, on a one-time only basis, you may have your eligibility restored if
your prior VA loan has been paid in full but you still own the property. In
either case, to obtain restoration of eligibility, the veteran must send a
completed
VA Form 26-1880
to our
Winston-Salem Eligibility Center. To
prevent delays in processing, it is also advisable to include evidence that
the prior loan has been paid in full and, if applicable, the property
disposed of. This evidence can be in the form of a paid-in-full statement
from the former lender, or a copy of the HUD-1 settlement statement
completed in connection with a sale of the property or refinance of the
prior loan.
Q: I sold the property I obtained with my prior VA loan on an
assumption. Can I get my eligibility restored to use for a new loan?
A: In this case the veteran’s eligibility can be restored only if the
qualified assumer is also an eligible veteran who is willing to substitute
his or her available eligibility for that of the original veteran.
Otherwise, the original veteran cannot have eligibility restored until the
assumer has paid off the VA loan.
Q: My prior VA loan was assumed, the assumer defaulted on the
loan, and VA paid a claim to the lender. VA said it wasn’t my fault and
waived the debt. Now I need a new VA loan but I am told that my used
eligibility can not be restored. Why?
or,
Q: My prior loan was foreclosed on, or I gave a deed in lieu of
foreclosure, or the VA paid a compromise (partial) claim. Although I was
released from liability on the loan and/or the debt was waived, I am told
that I cannot have my used eligibility restored. Why?
A: In either case, although the veteran’s debt was waived by VA, the
Government still suffered a loss on the loan. The law does not permit the
used portion of the veteran’s eligibility to be restored until the loss has
been repaid in full.
Q: Only a portion of my eligibility is available at this time
because my prior loan has not been paid in full even though I don’t own the
property anymore. Can I still obtain a VA guaranteed home loan?
A: Yes, depending on the circumstances. If a veteran has already used
a portion of his or her eligibility and the used portion cannot yet be
restored, any partial remaining eligibility would be available for use. The
veteran would have to discuss with a lender whether the remaining balance
would be sufficient for the loan amount sought and whether any down payment
would be required.
Q: Is the surviving spouse of a deceased veteran eligible for the
home loan benefit?
A: The unmarried surviving spouse of a veteran who died on active
duty or as the result of a service-connected disability is eligible for the
home loan benefit. If you wish to make application for the home loan benefit
as a surviving spouse, contact our
Winston-Salem Eligibility Center. In
addition, a surviving spouse who obtained a VA home loan with the veteran
prior to his or her death (regardless of the cause of death), may obtain a
VA guaranteed interest rate reduction refinance loan. For more information,
contact our
Winston-Salem Eligibility Center.
[NOTE: Also, a surviving spouse who remarries on or after attaining
age 57, and on or after December 16, 2003, may be eligible for the home loan
benefit. However, a surviving spouse who remarried before December 16, 2003,
and on or after attaining age 57, must apply no later than December 15,
2004, to establish home loan eligibility. VA must deny applications from
surviving spouses who remarried before December 16, 2003 that are received
after December 15, 2004.]
Q: Are the children of a living or deceased veteran eligible for
the home loan benefit?
A: No, the children of an eligible veteran are not eligible for the
home loan benefit.
. Do You Qualify For A VA Loan?
*Source: U.S. Department of Veterans Affairs
