People considering applying for a VA home loan need to consider the particular eligibility requirements laid out by the Office of Veterans Affairs. In order to qualify, applicants need to meet at least one of the following criteria:

• Served 90 consecutive days of active service during wartime
• Served 181 days of active service during peacetime
• Served at least six years of service with the National Guard or Reserves
• Are the spouse of a service member who lost their life in the line of duty or as a result of a service-connected disability

As long as you fall under one of these categories, you can apply for a Certificate of Eligibility.

A COE is a document that offers proof to your mortgage lender that you fulfill the eligibility requirements for a VA home loan. You can obtain a COE by applying through a VA-approved lender, applying online through the VA’s eBenefits portal or applying by mail with VA Form 26-1880. Obtaining this document is one of the first steps toward securing your VA loan.

The home that you plan to purchase also affects your eligibility for a VA loan. When you seek out a lender, they will request a VA appraisal of the property. This does not count as an official home inspection but aims to ascertain whether the home meets the VA’s requirements. The appraisal should deem the home move-in ready, and the home should be your primary residence. You might find that the property you want does not qualify for a VA loan because it requires too many initial repairs (a fixer-upper).

While VA home loans come with many benefits, borrowers still face the possibility of disapproval. As mentioned previously, the property must satisfy the appraisal process conducted by the VA. If the home does not meet the necessary requirements, the VA could deny the borrower a loan. The borrower also needs to have sufficient income to repay the loan, acceptable levels of debt and a credit score that meets the lender’s requirements.

In addition, the VA wants to ensure that its borrowers have enough to maintain themselves every month. This means a borrower must earn enough income to cover daily family needs and potential emergencies after paying for major expenses.