Legislation passed by Congress and signed by former President Donald Trump has expanded VA loan eligibility to tens of thousands of men and women currently serving in the National Guard.
Guard troops who have at least 90 days of qualifying Title 32 active-duty service, which includes a stint of 30 consecutive days or more, are now eligible for VA loans. This eligibility is retroactive so that members of the Guard who served as part of the nation's COVID-19 response in 2020 can now qualify for VA loans.
Previously, National Guard and Reserve members needed 90 days of active-duty service or six years of creditable service to be eligible for VA loans. This new law helps more Guard troops become eligible sooner.
Veterans, Active-Duty Military Personnel, and Surviving Spouses Are Eligible Too
Veterans, active-duty service members and surviving spouses continue to be eligible for VA loans. There are minimum active-duty service requirements that veterans and military personnel must meet to be eligible. These requirements can vary depending on when you served and whether your service took place during peacetime or wartime.
If you were discharged for a service-related disability, there are no minimum active-duty requirements. Surviving spouses of members of the armed forces can be eligible for VA loans as well. Learn more about eligibility requirements for VA loans.
About the Benefits of VA Loans
VA loans make buying or refinancing a home more affordable for the men and women who served our country. The benefits of VA loans include:
Competitive interest rates. Because the Department of Veterans Affairs backs VA loans, lenders can often offer veterans interest rates that are competitive with -- or lower than -- the rates available on other mortgage types.
Generous credit terms. Veterans can often qualify for VA loans with a minimum credit score of 580. A conventional loan typically requires a minimum credit score of 620.
VA homebuyers can buy a home with a 0% down payment. Most mortgages have minimum down payment requirements. However, veterans can buy a home with a 0% down payment using a VA loan.
No mortgage insurance. VA loans do not require monthly mortgage insurance. They do require a VA funding fee that serves a similar purpose. Conventional loans typically require mortgage insurance if you make a down payment of less than 20%, and FHA loans have similar upfront and monthly mortgage premiums.
Limits on closing costs. VA loan rules require the home's seller to pay commissions for real estate professionals, brokerage fees and buyer broker fees.
No prepayment penalties. There are no penalties or fees for paying off VA loans sooner than the terms require.
No limits on the number of times you can use a VA loan. There are no limits on the number of times a veteran can use VA loans to buy or refinance homes. However, there are some restrictions. Veterans can have only one VA loan at a time and are limited to buying or refinancing their primary residence.
Easier refinancing. Refinancing a VA loan can be easier with the VA streamline refinance program. The streamline program allows VA homeowners to refinance their mortgages to a lower rate with less paperwork, easier credit qualification, no home appraisals and faster closings.
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