In this article:
For active-duty service members and military veterans looking to buy a home, a U.S. Department of Veterans Affairs (VA) mortgage loan can offer an affordable option. VA loans may feature reduced closing costs, no mortgage insurance and no down payment in many cases. Key VA loan requirements to know about for 2027 include meeting eligibility criteria, demonstrating creditworthiness, using the home as your primary residence and typically paying a funding fee.
Who Is Eligible for a VA Loan?
VA loan eligibility requirements for 2027 include meeting a range of criteria, two of which are unique to VA loans: service history and a Certificate of Eligibility (COE).
Service Criteria
VA loan borrowers must meet minimum criteria for active-duty service. Current service members meet the minimum requirements after 90 continuous days of service. Service criteria for veterans can vary depending on the dates of service. Veterans discharged under a qualifying exemption or for a service-connected disability may have lower requirements.
Service Criteria
- Veterans and Active-Duty
- National Guard and Reserve
| Dates of Service | Minimum Active-Duty Service Requirement |
|---|---|
| Currently on active duty | 90 continuous days |
| August 2, 1990 - present | 24 continuous months, or the full period (at least 90 days) if called or ordered to active duty |
| September 8, 1980 - August 1, 1990, or October 17, 1981 - August 1, 1990, if served as an officer | 24 continuous months, or the full period (at least 181 days) if called to active duty |
| May 8, 1975 - September 7, 1980, or May 8, 1975 - October 16, 1981, if served as an officer | 181 continuous days |
| August 5, 1964 - May 7, 1975, or November 1, 1955 - May 7, 1975, if served in the Republic of Vietnam | 90 total days |
| February 1, 1955 - August 4, 1964 | 181 total days |
| June 27, 1950 - January 31, 1955 | 90 total days |
| July 26, 1947 - June 26, 1950 | 181 continuous days |
| September 16, 1940 - July 25, 1947 | 90 total days |
| Type of Service | Minimum Service Requirement |
|---|---|
| National Guard members | 90 days of non-training active duty Title 10 service, or 90 days of active-duty service including at least 30 consecutive days (your DD214 must show 32 USC sections 316, 502, 503, 504 or 505 activation), or six creditable years in the National Guard and you continue to serve or were discharged honorably or placed on the retired list |
| Reserve members | 90 days of non-training active-duty service, or six creditable years in the Selected Reserve and you continue to serve or were discharged honorably or placed on the retired list |
Certificate of Eligibility (COE)
A certificate of eligibility (COE) is a VA document showing lenders that you qualify for the VA loan benefit and the amount of your entitlement. VA loans are partially guaranteed by the VA; your entitlement is the amount the VA will pay your lender if you default on your loan.
You can request a COE online through the VA, through your lender or by completing a Request for a Certificate of Eligibility and mailing it to your regional loan center.
VA Loan Financial Requirements
In addition to service requirements, VA loan applicants must also meet certain financial requirements to ensure that they are creditworthy and able to repay the loan.
| VA Loan Financial Requirements | |
|---|---|
| Credit score | No VA minimum; lenders typically require 620 to 670 minimum |
| Employment and income | Stable, verified income meeting residual income guidelines |
| Debt-to-income (DTI) ratio | Typically 41% or less |
| Funding fee | 1.25% to 3.3% |
Credit Score
The government doesn't require a minimum credit score for VA loan borrowers, but lenders may set their own requirements, which may be more lenient than for a conventional loan. The minimum FICO® Score☉ Θ lenders require for a VA loan is typically 620 to 670, though borrowers with lower credit scores may still qualify in exchange for a higher interest rate (or a larger down payment).
Learn more: What Is a Good Credit Score?
Employment and Income
VA loans require a stable, reliable income. Typically, lenders want to see W-2 forms, pay stubs, tax returns or bank statements demonstrating at least two years of steady employment.
The VA also considers your residual income—how much money you have left each month after covering debts, housing expenses, child care costs, taxes and other essentials. VA residual income guidelines are based on location, loan amount and household size.
Debt-to-Income (DTI) Ratio and Residual Income
Your debt-to-income ratio (DTI) shows how much of your monthly gross income goes toward your debt payments. VA loans usually require a DTI of 41% or less, but a higher DTI doesn't automatically disqualify you. For example, a residual income (see above) exceeding the required guidelines could offset the risk from a higher DTI.
Funding Fee
The funding fee is a one-time fee paid at closing by VA loan borrowers to help cover the program cost to U.S. taxpayers. You can either pay the fee in full at closing or finance it by adding it to your loan and paying it off over time with your loan.
Your funding fee is typically a percentage of the total loan amount and may vary depending on whether it's your first time using a VA loan and if you submit an optional down payment. If you opt for a down payment below 5% (including 0%) and it's your first time using a VA loan, your VA funding fee is 2.15% of the total loan amount. If you've used a VA loan before, though, that fee goes up to 3.3%.
The funding fee drops to 1.5% if you put down 5% or more and to 1.25% if you put down 10% or more. However, this may defeat the purpose of a VA loan for some borrowers.
Some borrowers are exempt from the funding fee, such as veterans receiving VA compensation for service-connected disabilities or active-duty service members who are Purple Heart recipients.
Tip: Because the VA funding fee is based on your loan amount, it can add up if you're getting a larger loan. Getting quotes for both VA and conventional loans can help you compare costs.
VA Loan Property and Occupancy Requirements
A home purchased with a VA loan must be your primary residence and meet VA standards for the types of property you can finance.
Property Requirements
VA purchase loans are permitted for the following property types:
- A single-family home with up to four units
- A condo in a VA-approved project
- A manufactured home or lot
You may also be able to use a VA loan for building a new home, buying and improving a home or making your home more energy-efficient.
Occupancy Requirements
To qualify for a VA loan, you must plan to use the home you're purchasing as your primary residence. In some situations, such as if you're active duty and deployed, you can meet this requirement if your dependents live in the home full time.
How to Apply for a VA Loan in 2027
Borrowers get VA loans through private lenders, such as banks or credit unions, but the process varies slightly from other types of loans.
1. Confirm Your Eligibility
If you believe you're eligible for a VA loan, visit the VA website to request your COE. You'll need to provide personal information, including Social Security number and date of birth, and may be asked for other information.
2. Find a VA Lender
You can choose any lender that issues VA loans, including a bank, credit union or mortgage company. While the VA sets some requirements and fees, lenders can set their own interest rates and other fees, so it pays to do some comparison shopping.
Learn more: Compare Current VA Loan Rates
3. Apply for the Loan
You can submit your mortgage preapproval application to multiple lenders to compare quotes, since one might offer a lower interest rate than others. If you get the green light, you'll typically receive a preapproval letter showing sellers you're a qualified buyer.
Credit checks for mortgage preapprovals may involve hard inquiries that could cause a slight drop in your credit scores. However, multiple mortgage inquiries are treated as one inquiry if they occur within 14 to 45 days, depending on the scoring model, so limiting your preapproval applications to a two-week span can minimize any credit score damage.
Once you find your perfect home, you'll complete the full application for a VA loan. A VA-approved appraiser must appraise the home's value and ensure it meets the VA's minimum property requirements (MPRs). This appraisal is in addition to any inspection you choose to do (which the VA highly recommends, and your lender might require anyway).
Tip: Work with your real estate agent to ensure your purchase contract includes the "VA escape clause" or "VA option clause," allowing you to void the contract if the home appraises for less than the purchase price.
4. Receive Loan and Close
If your loan application is approved, the lender must give you a closing disclosure at least three business days before closing. Review your final loan details carefully and ask questions about anything that's unclear. Then it's time for closing, which involves signing lots of paperwork, officially receiving the loan and closing on the home.
Learn more: What Type of Mortgage Loan Is Best?
Frequently Asked Questions
Can My Spouse Apply for a VA Loan?
Civilian spouses of an active-duty service member or living veteran are not eligible to apply for a VA loan on their own. The eligible service member or veteran must apply.
However, a surviving spouse of a deceased veteran may be eligible; so may the spouse of an active-duty service member who is missing in action or being held as a prisoner of war.
Do I Need Mortgage Insurance for a VA Loan?
No, VA loans don't require mortgage insurance; instead, most borrowers pay a funding fee that typically ranges from 1.25% to 3.3% of the loan amount. This gives VA loans an advantage over FHA loans insured by the Federal Housing Administration, which require mortgage insurance premiums, and conventional loans, which often require private mortgage insurance (PMI) payments if your down payment is less than 20%.
That said, the VA funding fee can be considerable, so you should compare your options to determine the best deal for your situation.
Does a VA Loan Get You a Better Rate?
VA loans typically have lower interest rates than conventional mortgage loans. The average interest rate on a VA loan was 7.01% in October 2026, compared to an average interest rate of 7.74% on a 30-year fixed-rate conventional loan, according to Optimal Blue data via Federal Reserve Economic Data (FRED). Use a mortgage calculator to compare loan costs and see how much a lower rate might save you.
The Bottom Line
VA loans can help eligible borrowers save money, but their perks don't come for free. The VA imposes strict limits on eligibility of borrowers and properties, and the percentage-based funding fee can cancel out some of the other savings.
If you think you're eligible for a VA loan, ask the lender to also prepare a quote for a conventional loan. Compare fees and costs, including how they vary if you do or don't make a down payment, to ensure you get the best deal.
Keep in mind that the higher your credit score, the better terms a lender can offer you. Is homebuying on your horizon? You can review your credit report and FICO® Score for free from Experian and see how to get your credit ready for a mortgage.