VA Home Loan Requirements: Easy Guide for 2026

VA home loans are among the most powerful benefits available to eligible veterans, active-duty service members, and certain surviving spouses—often offering 0% down, no monthly mortgage insurance, and more flexible credit guidelines than many other programs. This guide breaks down VA home loan requirements in plain English, including eligibility, the Certificate of Eligibility (COE), credit and income basics, residual income, high DTI approvals, and what to do if you were denied by another lender.

Important: The VA sets the baseline guidelines, but many lenders add stricter rules called lender overlays (higher credit score requirements, lower DTI limits, stricter collections policies, etc.). Gustan Cho Associates follows VA agency guidelines and works with lenders that keep overlays to a minimum, which is why many borrowers who were turned down elsewhere can still get approved here.

Key Benefits

Why VA Loans are Different

• 0% down is possible for eligible borrowers (subject to entitlement, loan amount, and lender approval)
• No monthly mortgage insurance (MI)
• Competitive rates compared with many other loan types
• Flexible credit guidelines (the VA does not set a minimum credit score, but lenders may)
• High debt-to-income (DTI) approvals are possible when the file is strong—especially with residual income

What You’ll Learn in This VA Requirements Guide

• Who qualifies for a VA loan, and how eligibility is determined
• How to get your Certificate of Eligibility (COE)
• How lenders evaluate credit, collections, and late payments
• VA’s approach to DTI and residual income (and why high DTI can still pass)
• When manual underwriting is possible, and what underwriters look for
• Common reasons borrowers get denied—and how to fix them

Two Common Myths (and What’s Actually True)

Myth #1: “VA loans have no maximum loan limit.”

Many eligible borrowers with full entitlement are not capped by county loan limits the way they once were—but your practical loan amount still depends on income, credit, appraisal value, entitlement, and lender approval.

Myth #2: “VA loans have no minimum credit score.”

The VA doesn’t publish a minimum score requirement. However, most lenders do have a minimum, and approval depends on the overall file (payment history, DTI/residual income, and AUS results). In some cases, borrowers with lower scores may still qualify with the right lender and strong compensating factors.

The VA “Residual Income” Test

Residual income is the money you have left over each month after paying major expenses (housing payment + debts + basic obligations). VA loans are unique because high residual income can offset a higher DTI, which is why some veterans get approved even above the DTI limits that other programs would reject.

Want to Know if You Meet VA Home Loan Requirements?

If you have a COE (or you’re not sure yet), we can review your scenario and tell you whether you’re likely to qualify through AUS or if manual underwriting may be an option—especially if you have bad credit, high DTI, collections, or a prior bankruptcy.

What Are VA Loans?

In 1944, U.S. President Franklin Delano Roosevelt endorsed and signed the Servicemen Readjustment Act, also known as the GI Bill of Rights. John Strange, a senior mortgage loan originator at Gustan Cho Associates says the following about the benefits of VA home loans.

100% financing, no maximum loan limit, no mortgage insurance, and low competitive mortgage rates make VA loans an exceptionally accessible option for qualified borrowers.

This legislation was designed to assist U.S. veterans and their families in achieving the dream of homeownership. Through VA loans—federally guaranteed home loans that do not require a down payment as long as applicants meet the VA home loan requirements—veterans and their families can turn the dream of owning a home into reality.

What Are The Minimum VA Home Loan Requirements

One of the most significant benefits the government provides to military veterans is the provision of VA Loans, available to those who meet the VA Home Loan Requirements. For many years, the U.S. Department of Veteran Affairs has been offering these loans with 100% financing, underscoring its commitment to veterans.

VA loans are widely regarded as the premier loan program in the United States today. Eligibility for this outstanding loan program is exclusively for veterans possessing a Certificate of Eligibility (COE).

The Department of Veteran Affairs sets the criteria for VA Home Loans, determining eligibility based on several factors. These include whether the service was during wartime or peacetime and the duration of the veteran’s service, which are crucial in issuing a COE.

What Are The VA Home Loan Requirements

Thank you, veterans, for your service. We deeply appreciate your dedication to our safety. Let us assist you in obtaining a VA loan for your home purchase. We offer no lender overlays and flexible VA home loan requirements to make the process accessible. Dale Elenteny, a senior mortgage loan originator at Gustan Cho Associates says the following about VA loan requirements:

VA loans were established by the U.S. government as a gesture of gratitude to our society’s members for their service, both in peacetime and wartime.

VA home loan requirements are known to be more lenient than other mortgage loan programs. VA loans, while highly beneficial, may only suit some individuals. Rest assured, we will continually update this guide on VA home loan requirements to reflect any changes as they occur.

Who Makes The VA Home Loan Requirements?

A common question is about who establishes the VA home loan requirements. This is an excellent query. The Veterans Administration and individual mortgage lenders set the VA home loan requirements.

The Department of Veterans Affairs, a key government body, administers and defines VA home loan eligibility guidelines for active duty service members, retired veterans, and the spouses of deceased eligible members.

It is highly advantageous for veterans to read this guide on their first encounter to understand their VA eligibility fully. In the following paragraphs, we will cover the VA home loan requirements.

VA Home Loan Requirements During Service Periods

Eligibility requirements for obtaining a VA loan during various wartime service periods are outlined as follows:

• Vietnam Era: The designated wartime period spans from August 5, 1964, to May 7, 1975.
• Persian Gulf, Afghanistan, and Iraq: The service period extends from August 2, 1990, to the present.

Individuals need to have completed a minimum of 90 days of active duty service during certain timeframes to qualify for a VA home loan.

How Do I Know If I Am Eligible For A VA Loan?

VA Home Loan Requirements For Eligibility During Peacetime Periods Of Services:

• Period of peacetime services between 05/08.1975 to 08/01/1990
• The veteran must have completed at least 181 days of continuous active duty military service.
• Military reserve members and members of the National Guard must have completed at least six years as members of the Selected Reserves.
• Spouses of a prisoner of war or missing-in-action veteran is eligible as long as they have been a prisoner of war or missing in action for at least 90 days.

What Is The Lowest Credit Score I Can Have To Buy a House With a VA Loan?

Mortgage lenders may impose additional VA home loan requirements beyond the standard agency guidelines, known as lender overlays. Suppose your application for a VA loan is denied.

In cases of lender overlays by lenders, it’s crucial to determine whether the rejection was because you still need to meet the official VA agency guidelines or due to the lender’s specific overlays.

We will comprehensively detail all the VA home loan requirements to ensure that, should a lender deny your loan, you can identify whether the denial was based on failing to meet the VA’s standards or the lender’s additional requirements.

VA Loan Eligibility Requirements

Gustan Cho Associates strictly adheres to the VA’s basic VA home loan requirements without imposing additional lender overlays. Lender overlays are extra criteria that some mortgage lenders add to what the Veterans Administration requires. These can complicate the approval process for borrowers needing to meet these heightened standards. Not all lenders who provide VA home loans operate under the same conditions.

While some may enforce these additional requirements, Gustan Cho Associates offers VA mortgage loans based solely on the fundamental VA home loan requirements.

Lender overlays by lender  approach ensures that if you don’t qualify with one lender due to their overlays, you might still get approved by Gustan Cho Associates, who do not impose such overlays. Understanding these minimum VA Home Loan Requirements, as determined by the Veterans Administration, is crucial for veterans navigating the loan process. This knowledge can make a difference in successfully securing a VA loan.

What Are The Minimum VA Agency Guidelines from the Veterans Administration

We have detailed the principal VA home loan requirements set forth by the Veterans Administration for veterans to consider while applying for a VA home loan. It’s important to remember that if you satisfy the VA home loan requirements outlined below, you will qualify for a VA home loan through a mortgage lender that does not impose additional lender overlays. VA loans are accessible to eligible homebuyers who possess a Certificate of Eligibility.

What is the Minimum Credit Score for a VA Loan?

VA home loan requirements do not include a minimum credit score if an approved/eligible decision is returned by the automated underwriting system (AUS). This allows homebuyers to be eligible for VA loans with credit scores as low as 500 FICO, either through AUS or manual underwriting.

Achieving approval from the automated underwriting system hinges on having maintained timely payments on all monthly obligations over the past 12 months.

Suppose homebuyers do not receive an approve/eligible decision but are designated refer/eligible by the AUS. In that case, they may still qualify through manual underwriting, for which specific guidelines are provided.

Automated Underwriting (AUS) vs Manual Underwriting on VA Loans

Most VA loans are first evaluated by an Automated Underwriting System (AUS). AUS reviews the whole file—credit history, income, assets, and debts—and returns findings such as Approve/Eligible or Refer/Eligible.

If AUS Returns Approve/Eligible:

This is the most common path. VA does not publish a strict maximum DTI cap for AUS approvals. Instead, lenders focus on the overall risk profile—especially residual income (the money you have left each month after your major obligations).

If AUS Returns Refer/Eligible:

A Refer/Eligible finding means you may still qualify, but the file generally requires a manual underwrite (a human underwriter reviews the file in greater detail). Manual underwriting is typically used when an AUS cannot issue an approval due to factors such as limited credit depth, recent credit events, high DTI without strong offsets, or recent late payments.

What Underwriters Look for in a VA Manual Underwrite

Manual underwriting is not “one-size-fits-all.” VA lending is built around ability-to-repay and residual income, so the underwriter will focus on:

• Recent payment history: a strong pattern of on-time housing and installment payments is critical
• Residual income: whether you have enough monthly leftover income after the new housing payment and debts
• Stable income/employment: consistent earnings and a reasonable explanation for gaps
• Compensating factors: items that reduce risk (cash reserves, stable housing history, long job history, low payment shock, etc.)

How Much On-Time Payment History is Needed?

Rather than quoting conflicting “12 months vs 24 months” rules, here’s the safest and clearest way to state it:

Common lender practice: Most underwriters want to see a strong recent history of on-time payments (especially in housing), and any recent late payments can trigger a manual review or denial, depending on the severity and timing.

What we do: We review your full timeline and identify the strongest approval path (AUS first, and manual underwriting when appropriate).

Is There a DTI Cap on VA Manual Underwriting?

VA underwriting is not typically explained using FHA-style fixed DTI caps. On VA loans, DTI is important, but it’s not the only decision point. Manual underwriting is often more conservative, and approvals are heavily influenced by:

• Residual income
• Payment shock
• Compensating factors
• Strength of recent credit history

In other words: high DTI can still be possible on VA loans when residual income and compensating factors support it—especially with the right lender and experienced underwriting approach.

Bottom line: AUS approval is ideal. If you receive a Refer/Eligible finding, manual underwriting may still allow approval, but the file must show strong recent payment history, stable income, and sufficient residual income.

Can I Get a VA Loan With Collections or Charge-Offs?

Many veterans can still qualify for a VA home loan with collections, charge-offs, and past credit problems—but approval depends on the overall file, your recent payment history, and whether the lender has additional requirements (overlays).

VA Baseline (general rule)

• VA underwriting typically focuses on whether you have demonstrated reasonable credit responsibility and the ability to repay the new mortgage.
• Unpaid collections and charge-offs are not always required to be paid as a condition of VA approval.
• The most important credit factor is often your recent history—especially housing and installment payment performance.

Common Lender Practice (where overlays show up)

Some lenders may require extra steps even when VA home loan requirements don’t, such as:

• Paying certain collections (or requiring proof of resolution), depending on the size, type, or recency
• Requesting letters of explanation for derogatory credit
• Requiring a higher credit score than the VA baseline
• Being stricter when there are recent late payments, multiple active collections, or thin credit depth

What Matters Most for Approval

Underwriters usually look at:

• How recent the derogatory credit is (recent activity matters more than older items)
• Whether there are new collections or recent charge-off activity
• Your on-time payment pattern in the most recent 12 months (especially housing)
• Whether you have sufficient residual income and a stable income

Important: Having collections does not automatically mean “yes” or “no.” VA approvals are highly file-specific, and lender overlays can change the outcome even when the borrower appears to meet VA agency standards.

What We Do at Gustan Cho Associates

If you were told “you must pay off all collections,” we’ll review:

• Your credit report details (type, balance, dates, and recent activity)
• Your AUS findings (Approve/Eligible vs Refer/Eligible)
• Whether a different lender option (with fewer overlays) improves the result

VA Residual Income Explained

Residual income is the amount of money you have left each month after paying your significant obligations—especially your new housing payment and monthly debts. VA loans are unique because the VA doesn’t rely solely on debt-to-income (DTI). Residual income is a major factor in why some veterans can get approved even with a higher DTI.

Think of it like this:

DTI shows your percentage, but residual income shows your real-life ability to afford the payment.

What Counts Toward Residual Income?

Residual income is generally what’s left after your:

• Proposed housing payment (principal + interest + taxes + insurance + HOA, if applicable)
• Monthly debt payments (car loans, credit cards, student loans, personal loans, etc.)
• Basic household obligations are considered in the VA method (varies by household size and region)

Quick Residual Income Example

Let’s say a borrower has:

• Gross monthly income: $7,500
• Estimated take-home after typical withholdings: $5,800
• New total housing payment: $2,200
• Monthly debts: $900

Estimated residual income: $5,800 – $2,200 – $900 = $2,700 left over

That “leftover” amount is what helps the underwriter answer the fundamental question:

After everything is paid, do you still have enough money each month to live comfortably and handle unexpected expenses?

Why Residual Income Matters More Than DTI on VA Loans

With many loan types, a high DTI can be an automatic “no.” With VA, a high DTI can still be workable when the borrower has:

• Strong residual income
• A history of on-time housing payments
• Stable income
• Compensating factors (cash reserves, minimal payment shock, long job history, etc.)

How to Improve Residual Income (Practical Fixes)

If your residual income is tight, common solutions include:

• Paying off or reducing a monthly debt to lower your total obligations
• Choosing a slightly lower purchase price/payment
• Buying down the interest rate (when it makes sense)
• Adding a qualified co-borrower in eligible scenarios
• Documenting stable income (including allowable VA-eligible income sources)

Bottom line: VA approvals are not just about your credit score or DTI. If your residual income is strong, you may still qualify—even when other lenders say no.

Can You Qualify For a VA Loan With Gaps In Employment in The Past Two Years?

Two years of employment history but gaps in employment allowed. There is no maximum loan limit on VA loans. Primary residentially zoned one to four-unit properties is eligible for VA home loans.

What Are The Steps To Applying For a VA Home Loan?

The first step of qualifying and getting pre-approval on a VA loan is to get a certificate of eligibility (COE).  To receive this certificate, the borrower must file VA Form 26-1880, Request for Determination of Eligibility and Available Loan Guaranty Entitlement. Spouses of Veterans and service members who have died while on duty in the service or have died because of a disability due to the result of serving in the armed services may also be eligible by the Department of Veteran Affairs. You then have to choose a lender.

How Can You Receive a Certificate of Eligibility From the Veterans Administration?

To receive a certificate of eligibility from the United States Department of Veteran Affairs, the VA Loan borrower must have filed a VA Form 26-1880 for Determination of Eligibility and Available Loan Guaranty Entitlement. First, a borrower must have a certificate of eligibility from the VA to obtain a loan.

Gustan Cho Associates has a reputation for helping borrowers who could not qualify at other lenders. We say YES when other lenders say NO on VA loans.

The team at Gustan Cho Associates can help borrowers obtain the COE and help you start the homebuying and mortgage process. Gustan Cho Associates are experts on VA loans. Not all mortgage lenders have the same lending requirements on VA loans. In the paragraph below, we will explain why one lender has a higher lending requirement than another. Gustan Cho Associates has a national reputation for being able to approve VA loans with bad credit when others can’t.

VA Home Loans For Active Duty Military Personnel

Veterans who served on active duty in the following branches of the U.S. Military with a military discharge other than dishonorable discharge are eligible for VA loans:

• U.S. Army
• U.S. Air Force
• U.S. Navy,
• The United States Marine Corps
• United States Coast Guard

Soldiers currently in the military and on active duty are eligible to qualify for VA Loans if they have served for at least 90 or more days without any gaps in employment. For veterans who did not have wartime service during the Persian Gulf Era, at least 181 days of active duty service is necessary to qualify for VA loans.

The Following Are The Time of Service VA Home Loans

Here are the VA Eligibility Requirements:

• Served 90 or more days during wartime
• The veteran has served at least 181 or more continuous days during peacetime

VA Home Loans on Two-Year Rule

In this section, we will cover VA home loan requirements on the TWO-YEAR RULE: If the veteran has enlisted or began military service after 7 September 1980 or was an officer of the U.S.

Military and started serving our country on 16 October 1981. Then, the following conditions need to be met: The veteran must have served at least 24 months or more, or the veteran’s service serving on active duty cannot be less than 90 continuous days during wartime or less than 181 continuous days during peacetime.

VA Loan Eligibility: Wartime vs Peacetime

VA loan eligibility is based on your type of service and length of service. You do not need to memorize wartime and peacetime date ranges to figure this out—the fastest way is to confirm your eligibility through your Certificate of Eligibility (COE).

Here’s the simple breakdown most borrowers need:

You May Qualify if You are:

• An eligible veteran with qualifying active-duty service and an appropriate discharge status
• An active-duty service member who meets the VA’s minimum service requirement
• A member of the National Guard or Reserves with enough qualifying service time
• An eligible surviving spouse (in certain situations)

Minimum Service Requirements

In general, VA eligibility is based on one of these paths:

• Wartime service: Often, 90 days of active-duty service may qualify
• Peacetime service: Often, 181 days of continuous active-duty service may qualify
• National Guard/Reserves: Often, 6 years of service may qualify (or qualifying active-duty orders in some cases)
• Surviving spouses: Eligibility may apply in specific circumstances (such as certain line-of-duty or service-related situations)

Note: Eligibility may vary by service dates, orders, and circumstances—your COE is the official confirmation.

About the Persian Gulf “Wartime” Period

You may see older articles list the Persian Gulf wartime period with a confusing “end date.” For practical purposes, the VA continues to treat the Persian Gulf era as ongoing for eligibility purposes. The COE is the simplest way to confirm eligibility without getting lost in timelines.

The Fastest Way to Confirm You’re Eligible

Instead of guessing which service period you fall under, do this:

1. Request your Certificate of Eligibility (COE) (we can help)
2. Once your COE is confirmed, the next step is reviewing credit, income, and residual income for pre-approval.

Can I Get a VA Loan With Bad Credit?

Eligible veterans with a certificate of eligibility (COE) can qualify for a VA home loan with bad credit. You do not have to pay outstanding collection account balances to qualify for a VA loan.

VA only cares that you have been timely on your payments for the past 12 months. Eligible retired or active members and eligible surviving spouses of veterans of the U.S. Armed Services can qualify for VA loan programs at Gustan Cho Associates with zero lender overlays.

What Are The Minimum Requirements For a VA Home Loan?

Not all lenders have the same VA home loan requirements on VA loans due to lender overlays. Gustan Cho Associates has zero lender overlays on VA loans. Over 75% of our clients could not qualify at other lenders due to overlays, last-minute mortgage denial, or stress during the mortgage process. Most borrowers get qualified and close at Gustan Cho Associates with zero stress.

Best VA Lenders With No Overlays

Gustan Cho Associates are mortgage advisors licensed in 48 states, including Washington DC and Puerto Rico (Not licensed yet in MA and NY). As with other government loan programs like FHA and USDA, there are mortgage lending guidelines with VA loans concerning minimum credit score requirements and debt-to-income ratio requirements. We are a no overlay VA mortgage lender. As long as you get an approve/eligible per the Automated Underwriting System, you will close on your VA loan.

Who Qualifies For a VA Loan?

Not all members of the U.S. Military can qualify for a VA loan. You need a certificate of eligibility (COE) to be eligible for VA loans. Active or retired members of the U.S. Military with a certificate of eligibility (COE) will qualify for a VA loan.

How Do Veterans Become Eligible For VA Loans

In this section, we will cover the eligibility guidelines for VA loans. The veteran must have served 181 days of active service during peacetime. Veterans must have served 90 consecutive days of active service during wartime. Or, the veteran must serve more than six years of service with the National Guard or Reserves or served at least 90 days under Title 32, with at least 30 consecutive days. Just because you have served does not automatically entitle you to VA home loan benefits.

How Hard Is It To Get a VA Loan?

One of the frequently asked questions at Gustan Cho Associates is how hard is it to get a VA loan? For borrowers who are eligible and have VA entitlement, the process of getting a VA home loan is very simple.

Eligible borrowers do not have to come up with any down payment, no minimum credit score requirements, and no maximum debt-to-income ratio caps.

There is no maximum loan limit on VA loans. Another great benefit on VA mortgage loans is there is no mortgage insurance required. The team at Gustan Cho Associates is available 7 days a week, late evenings, on weekends, and on holidays. Licensed in most of the 50 states. Over 75% of our borrowers could not qualify at other lenders due to lender overlays, stress during the mortgage process, or last-minute loan denial.

Competitive rates: We have lending partnerships with over 170 wholesale lenders. No lender overlays. Expertise in being able to do VA loans other lenders cannot do.

Can You Get Denied After Being Pre-Approved For a VA Loan?

Most mortgage lenders have their own VA home loan requirements, or overlays, they create and require. VA home loans are marketed, originated, and funded by private mortgage lenders who have their own lender overlays.

What this means is they have their own credit score, debt-to-income ratio, and other credit/income lender overlays they require.

There are lenders like Gustan Cho Associates with no lender overlays. We have a business model where we have wholesale lenders who just go off VA agency mortgage guidelines and has zero overlays on VA loans.

Can You Get Approved For a VA Loan After Being Denied?

There are many cases where some borrowers get approved for a VA home loan with a particular lender while others get denied even though they meet the minimum VA home loan requirements of the VA.

Many people who are eligible for a VA home loan and meet all of the VA home loan requirements get denied by many lenders who have lender overlays.

This is often the case when the borrower has low credit scores, prior bad credit, collections, charged-off accounts, high DTI, and other credit/income issues.

How Can I Find a Lender To Approve Me on a VA Loan After Being Denied?

Many veterans assume all VA home loan requirements are the same among mortgage lenders on VA loans. However, this is not true. There are two different types of mortgage guidelines on VA loans. The first and foremost, all mortgage lenders need to make sure their borrowers meet the minimum VA agency guidelines of the U.S. Veterans Administration (the VA). The second type of guidelines on VA loans are the internal individual VA home loan requirements by the lender called lender overlays.

Best Mortgage Lenders For VA Loans With No Overlays

Over 80% of our clients at Gustan Cho Associates are borrowers who could not qualify at other lenders. There are no minimum credit score requirements. Scores down to 500 FICO.

There are no maximum debt-to-income ratio caps with an AUS approval. Debt-to-income ratio of 65% approved per AUS. Gustan Cho Associates are experts in Manual Underwriting of VA loans.

There is no down payment requirement on a home purchase. 100% financing on owner-occupant one to four-unit homes. There is no mortgage insurance premium required. There is no maximum loan limit on VA loans. Read More on Getting Mortgage Approval After Being Denied

What Should I Look For In A VA Lender?

Mortgage lenders can have lenders overlays on VA home loans. Lender overlays are lending requirements that are higher than the minimum agency VA guidelines. Make sure you do your research on the mortgage lender’s minimum VA Home Loans. At Gustan Cho Associates, we have no lender overlays. We just go by the VA agency guidelines. Most of our VA home loans close in 30 days or less. 

Best Mortgage Lenders For VA Loans After Being Denied

Over 75% of our borrowers are folks who could not qualify at other lenders due to last-minute loan denial, stress during the mortgage process, and not being able to get a hold of their loan officers. We have a national reputation for being able to do loans other lenders cannot do.

Gustan Cho Associates is referred to as a One-Stop Mortgage Shop due to having a network of over 190 wholesale mortgage lenders.

The team at Gustan Cho Associates strives to get the best of the best service, loan program, rates, and net tangible benefits for our borrowers. We are grateful to our clients and preferred realtor partners for our expanding growth and success. Thank you for your confidence, faith, and trust in Gustan Cho Associates in having us as your mortgage professional for life. The team at Gustan Cho Associates will not let you down.

Read More on Getting Mortgage Approved After Being Denied

Can I Qualify For a VA Loan After Bankruptcy?

Yes, you can qualify for a VA loan after bankruptcy. There are two types of bankruptcy: Chapter 7 and Chapter 13 Bankruptcy. The VA guidelines after Chapter 7 bankruptcy are different from Chapter 13 Bankruptcy.

Chapter 7 Bankruptcy is very straightforward, where the borrower needs to wait the mandatory two years after the discharge date.

You can qualify for a VA loan during and after Chapter 13 Bankruptcy. We will cover and discuss this topic in more detail. We will cover both types of VA home loan requirements after bankruptcy. Borrowers cannot have late payments during or after bankruptcy.

VA Home Loan Requirements After Chapter 7 Bankruptcy

Homebuyers can qualify for a VA loan after Chapter 7 Bankruptcy after a two-year waiting period. The waiting period is two years from the discharge date. You need to have rebuilt and re-established credit after the discharge date.

No late payments after the discharge date. The bankruptcy does not affect your mortgage rates on your VA loan.

Mortgage rates on VA loans are mainly based on credit scores. This is why it is very important to start rebuilding your credit when you get discharged from Chapter 7 Bankruptcy.

VA Loan Guidelines During Chapter 13 Bankruptcy

Homebuyers can qualify for VA loans during the Chapter 13 Bankruptcy repayment period one year after being in the plan. The Chapter 13 Bankruptcy does not need to be discharged to be eligible for a VA loan.

You need to have made twelve timely payments to your Chapter 13 debts. The bankruptcy trustee needs to approve the mortgage. It needs to be a manual underwrite.

Gustan Cho Associates are experts in helping veterans get approved and close on VA loans during the Chapter 13 Bankruptcy repayment plan.

VA Home Loan Requirements After Chapter 13 Bankruptcy

No waiting period is required after the Chapter 13 Bankruptcy discharge date to qualify for VA home loans. If the discharge date of the Chapter 13 Bankruptcy is not at least two years old, the file needs to be a manual underwrite. We will cover manual underwriting guidelines on VA loans later in this guide. Verification of rent is required on manual underwrites.

Difference Between Automated and Manual Underwriting on VA Loans

The only difference between manual and automated underwriting system (AUS) findings approval files is the debt-to-income ratio on manual underwriting is limited. The front-end and back-end debt-to-income ratio on manual underwriting is based on the number of compensating factors the borrower has.

Do All Mortgage Lenders Have The Same Rates on VA Loans?

No. Not all mortgage lenders have the same mortgage rates on VA loans. It is wise to shop for the best rates and terms on VA loans with several lenders and compare the rates, terms, and closing costs.

Eligible retired or active members and eligible surviving spouses of veterans of the U.S. Armed Services can qualify for VA loan programs at Gustan Cho Associates with zero lender overlays.

The United States Department of Veteran Affairs, the VA, backs residential owner-occupant home purchase mortgage loans through private lenders.

What Type of Property Can I Buy With a VA Home Loan?

Eligible members can purchase a one to four-unit single-family home. There is no maximum loan limit on VA loans. As long as the property purchase price is appraised and the borrower meets the VA loan guidelines, the borrower can purchase any property without concerns about VA loan limit caps.

However, not everyone qualifies for VA mortgages. Only United States Armed Forces members with a valid Certificate of Eligibility (COE) are eligible for VA home loans. United States Armed Services members need to meet the eligibility VA loan guidelines and have been awarded a Certificate of Eligibility to qualify for a VA loan.

How Much Money Do I Need To Buy a House With a VA Loan?

An eligible homebuyer can qualify for a VA loan with zero down payment. VA loan-approved financial institutions offer 100% financing. There is no annual homeowners insurance premium on VA loans.  Veterans who qualify for VA loans can purchase a home with no money down. Lenders will finance qualified borrowers 100% financing at competitive rates.

To qualify for a VA loan, the home buyer needs to have been honorably discharged from a division of the United States Armed Services and have a certificate of eligibility.

One of the most frequently asked questions from first-time homebuyers who are using their VA loans for the first time is how long does VA loan approval take. Remember not all VA lenders have the same VA home loan requirements. All mortgage lenders need to meet the minimum agency  VA home loans.

What Is a Good Credit Score To Buy a House With a VA Loan?

There is no minimum credit score requirements to qualify for a VA loan per VA agency guidelines. However, it is highly recommended to boost and/or maximize your credit scores as high as possible. High credit scores mean lower rates on VA loans. The borrower’s credit scores is the biggest determinant on VA loans. Gustan Cho Associates have closed VA loans with credit scores down to 500 FICO.

How Much Is The VA Funding Fee?

In general, most veteran borrowers pay 2.3% VA funding fee. However, the VA funding fee varies between 0.5% to 3.6% of the VA loan amount, depending whether the borrower have used their VA entitlement before on a prior VA loan and/or if they are paying more than a 5% down payment on their home purchase.

Use Our VA DTI Mortgage Calculator With VA Funding Fee Calculations.

VA loans have a one time VA funding fee on all VA loans similar to the FHA one-time upfront mortgage insurance premium. The VA funding fee goes to the Department of Veterans Affairs (The VA) to support and fund VA loans. The VA funding fee depends on the individual veteran and their entitlement. 100% disabled veterans are exempt from paying the VA funding.
More on VA Funding Fee

VA Entitlement Explained (And When Loan Limits Matter)

Your VA entitlement is the amount the VA will guarantee on your home loan. Your Certificate of Eligibility (COE) shows whether you have full entitlement or remaining (partial) entitlement and how much entitlement is available.

If You Have Full Entitlement

If you have full entitlement, the VA does not set a county-based maximum loan limit the way it did in the past. In most cases, you can borrow what your lender approves based on your income, credit profile, and the home’s appraised value—without needing a down payment due to VA loan limits.

If You Have a Remaining (Partial) Entitlement

If you currently have a VA loan—or you’ve used some entitlement that hasn’t been restored—then county loan limits can still matter for zero-down eligibility. In that situation, your available entitlement is tied to a guaranty calculation that is often expressed as 25% of the county loan limit minus entitlement already used (and not restored).

Why Lenders Talk About “25% Guarantee”

VA-guaranteed loans are commonly structured around a 25% guaranty concept. If you don’t have full entitlement and you’re trying to do a 0% down payment, lenders often limit the loan amount to what meets that guaranty requirement.

The Easiest Way to Confirm Your Entitlement

You don’t need to do complicated math to get a reliable answer. The fastest approach is:

1. Pull your COE to confirm full vs partial entitlement
2. If partial, use the VA’s guaranty tools (or let your lender run the numbers accurately)

Manual Underwriting is when the Automated Underwriting System does not render an AUS approve/eligible and is a refer/eligible finding. Refer/eligible means the borrower can be eligible but wants to have a human underwriter manually underwrite the loan. There is no difference between AUS versus Manual Underwriting except for a restriction on the debt-to-income ratio.

Mortgage Rates on VA Loans on Manual Underwriting

Not all lenders will do manual underwriting. Gustan Cho Associates are experts on manual underwrites on VA mortgage loans for those who cannot get automated approval.

There are instances where an approve/eligible per automated underwriting system approved VA loan can get downgraded to a manual underwrite.

VA home loans have one of the lowest mortgage rates of any other mortgage loan program. Zero down payment and no mortgage insurance premium are two of the greatest benefits why veterans should take advantage of VA loans if they have a Certificate of Eligibility. There are no minimum credit score requirements on VA home loans. The automated underwriting system determines the debt-to-income ratio.

Can I Buy a House With a VA Loan With Poor Credit?

Mortgage loans guaranteed by the Veterans Administration are originated and funded by private mortgage lenders such as banks and mortgage companies that originate and fund owner-occupant home loans.

VA mortgage loans are a great program for veterans serving in the U.S. Army,  U.S. Navy, U.S. Air Force, United States Marine Corps, and United States Coast Guard.

Each branch of service has its own eligibility benefits and is determined by the type of service, the longevity of service, and the character of the service. The VA has created lenient guidelines.

How Do I Get Pre-Approved For a VA Loan?

Here are the basic VA agency mortgage guidelines:

• There are no minimum credit score requirements on VA mortgage loan programs
• There are no maximum debt-to-income ratio caps as long as the borrower gets an approve/eligible per automated underwriting system (AUS)
• There is no down payment requirement on a home purchase
• 100% financing on owner-occupant one to four-unit homes
• There is no mortgage insurance premium required on VA loans
• There is no maximum loan limit on VA mortgages

For more information about VA loan mortgage loans, please get in touch with us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at alex@gustancho.com. The team at Gustan Cho Associates is available seven days a week, on evenings, weekends, and holidays.

Other VA Home Loan Requirements For VA COE

Just because a soldier served in the U.S. Military does not mean they automatically qualify for a VA home loan. VA home loans with regards to being eligible for VA loans. Veterans discharged due to hardship or service-related disability can qualify for VA loans. Veterans who were discharged from the military for the convenience of the federal government can qualify if they have completed a minimum of 20 months of a 24-month enlistment agreement.

See If You Meet The VA Home Loan Requirements

The veteran must have served no less than 90 days during wartime and 181 continuous days during peacetime due to disability caused by serving in the armed services. Veterans discharged from active duty due to medical conditions, whether to connect or not connected with their service, can qualify for VA Loans. Veterans who received an involuntary discharge by any branch of the armed services from active duty due to the government’s discretion to reduce military personnel or due to the following:

• mental
• psychological
• or physical condition that would interfere with their service can qualify for VA loans as long as their discharge was not related to improper conduct

Unmarried spouses of veterans who are deceased while on active duty or died due to service-related disabilities can qualify. Unmarried spouses of veterans who are missing in action or prisoners of war can qualify for VA loans.

VA Home Loan Requirements For Veterans of Selected Reserves

Members of the Selected Reserves are those who are compensated and paid for training and serving on the reserves. These members are on the Selected Reserve and are called when the government needs additional troops to safeguard our country.

How Many Years of Service in the Reserves is Required To Be Eligible for VA Loans

Members of the Selective Reserves who would not qualify for VA loans can qualify if they have completed six years of service in the Selective Reserves without being called to active duty if they meet the following conditions:

• They have served and got an honorable discharge
• If they were on the retired list
• Were transferred to a division of the Ready Reserve or Standby Reserve
• Is continuously serving in the Selective Reserve unit
• The six years of service need not be continuous to qualify for VA loan programs or need not be in the same National Guard or Reserve division.
• Cannot combine active and reserve service to meet the six-year rule

VA Home Loan Requirements Versus Other Loan Programs

VA Guidelines to qualify for VA Loans are the following:

• No debt-to-income ratio requirements
• No credit score requirements
• 2-year waiting period after Chapter 7 Bankruptcy
• 2-year waiting period after Short Sale, Deed-in-Lieu of Foreclosure,or Standard Foreclosure
• Gustan Cho Associates has no lender overlays on VA loans

VA Appraisal vs Home Inspection: What’s the Difference?

Many buyers use the term “inspection” to refer to the VA appraisal. These are not the same thing:

1) VA Appraisal (Required)

A VA appraisal is required for a VA loan. It serves two main purposes:

• Confirms the home’s fair market value
• Verifies the property meets the VA’s Minimum Property Requirements (MPRs) for safety, soundness, and basic livability

The VA appraisal is primarily about value + minimum standards—it is not a full, detailed condition report.

2) Home Inspection (Optional—but strongly recommended)

A home inspection is optional, but it’s one of the smartest things a buyer can do. A licensed home inspector evaluates the home in much more detail (roof, HVAC, plumbing, electrical, foundation, attic, etc.) to help you understand repairs and future maintenance.

Bottom line: The VA appraisal protects the lender/VA; the home inspection protects you.

Common Reasons a Home May “Fail” VA Minimum Property Requirements (MPRs)

A property can run into issues during the VA appraisal if the appraiser identifies concerns such as:

• Safety hazards (exposed wiring, missing handrails where required, unsafe stairs)
• Roof problems (active leaks or conditions that suggest the roof won’t reasonably last)
• Heating system issues (home must have a working, adequate heat source)
• Water intrusion/moisture / mold-like conditions (especially when active or significant)
• Structural concerns (major foundation movement, severe deterioration)
• Pest/wood-destroying organisms (termite evidence may require treatment in certain areas)
• Peeling paint in pre-1978 homes (potential lead-based paint hazard)
• Poor access/egress (inability to safely access the home)

If the appraiser identifies an issue, the VA process typically requires the problem to be repaired (or otherwise resolved) before final loan approval—depending on its severity and lender requirements.

What Should Buyers Do Next?

• Always consider a private home inspection so you know what you’re buying.
• If an appraiser flags an MPR issue, we can help you and your agent understand the repair path and what documentation is needed.

The VA appraisal is less detailed than a home inspection and primarily focuses on the property’s safety and habitability. Potential buyers should also conduct a private home inspection to uncover any hidden issues.

For veterans needing a lender with no VA lender overlay, contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com.

The team at Gustan Cho Associates is available 7 days a week, on evenings, weekends, and holidays. The team at Gustan Cho Associates is available 7 days a week, on evenings, weekends, and holidays.

Frequently Asked Questions About VA Home Loan Requirements

What are the Basic VA Home Loan Requirements?

To qualify for a VA-backed loan, you generally need (1) VA eligibility/entitlement (usually proven with a COE), (2) occupancy as a primary residence, and (3) to meet credit and income requirements from both the VA and the lender.

How do I Know if I’m Eligible for a VA Loan?

The fastest way is to request your Certificate of Eligibility (COE). Your COE confirms whether you have VA home loan entitlement and what type (full vs remaining).

What Credit Score Do You Need for a VA Loan?

The VA does not set a single minimum credit score, but many lenders do (their own “overlays”). That’s why two veterans with the same profile can get different answers from different lenders.

What is the Maximum Debt-to-Income Ratio (DTI) for a VA Loan?

VA loans don’t work like “hard DTI caps” in every case—DTI is evaluated alongside residual income (what’s left each month after major obligations). High residual income can help support higher DTI scenarios.

What is VA Residual Income, and Why Does it Matter?

Residual income is the monthly money left after paying major expenses (including the projected mortgage payment and debts). VA underwriting places meaningful weight on this because it helps measure real affordability—not just ratios.

What Does “Manual Underwriting” Mean on a VA Loan?

Manual underwriting means a human underwriter reviews the file more closely (often after an AUS result, such as Refer/Eligible, or when certain risk factors are present). This path can still work, but it typically requires stronger documentation and a clearer picture of affordability.

If you’re interested in VA Loans and have questions or need more information, contact a VA-approved lender like Gustan Cho Associates. We specialize in VA Loans and can provide guidance without implementing lender overlays.

This blog about “VA Home Loan Requirements: Easy Guide for 2026” was updated on February 17th, 2026.

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