Skip to main content
Icon Mortgage

VA Loan Requirements for Reservists & National Guard

A VA loan is an incredible benefit for veterans or active duty service members. Unfortunately, many people who are eligible to receive this benefit aren’t aware they qualify, and most of those who aren’t aware are found in the Reserve and National Guard.

Reservists and National Guard members are entitled to the same VA loan benefits as those in regular military service, with slight exception. It’s important to help these servicemen and women understand their eligibility requirements so that they too can take advantage of the benefits a VA loan has to offer.

In a nutshell, a VA loan is a mortgage issued by approved lenders that’s guaranteed by the federal government. It allows eligible service members and veterans to either refinance up to 100% of their home or buy a new home with no money down.

Members of the National Guard or Reserve may qualify for a VA loan if they meet one of the following qualifications:

  • Served six years in selected reserve and were either

– honorably discharged

– retired

– transferred to Standby Reserve, or an element of the Ready Reserve other than the Selected Reserve, after honorable service

  • Served in the Selected Reserve for more than six years
  • Served in active duty for more than 90 days during a wartime period
  • Discharged or released from active duty for a service-related disability

Once eligibility is determined, the Reservist or National Guard member must obtain their Certificate of Eligibility (COE). The COE can be obtained through their mortgage lender as long as they have proper proof of service. If necessary, VA Form 26-1880 can be submitted to the Atlanta Regional Loan Center online or by mail.

The main difference for Reservists and National Guard members seeking a VA loan can be found in the funding fee, or the cost associated with obtaining a VA loan that helps ensure that the loan continues to require no down payment and no monthly mortgage insurance.

Down Payment

First-Time Use

Subsequent Use

None

5% or more (up to 10%)

10% or more

2.4%

1.75%

1.5%

  3.3%

1.75%

1.5%


  

                                                                

Cash-Out Refinancing:

First-Time Use

Subsequent Use

2.4%

3.3%

A VA loan is an incredible – and exclusive – benefit that eligible servicemen and women should take advantage of. They provide opportunities not offered with other loans, like the ability to refinance up to 100% of a home’s worth, no down payments on a home purchase, relaxed credit requirements, and more.  If you or your spouse are in the Reserve or National Guard, and you’d like to know more about your options, contact me and I will assist you.

VA Loan Eligibility Expands for Surviving Spouses

New law extends VA loan eligibility to more surviving spouses. Now a veteran’s death does not have to be duty-related for the widow to become eligible for VA home loan benefits. 
 
An addition to the VA eligibility guidelines is good news for surviving military spouses. A new law, known as The Honoring America’s Veterans and Caring for Camp Lejeune Families Act (H.R. 1627), makes VA loans available to additional surviving spouses.  Military widows can now be eligible if the veteran was rated totally disabled and eligible for compensation prior to death by any cause. The law designates that the veteran must have been eligible for compensation at the time of passing and be rated one of the following:
 
  1. Continuously totally disabled for at least 10 years immediately prior to death
  2. Continuously totally disabled for at least 5 years from the date of discharge
  3. Continuously totally disabled for at least 1 year prior to death of a POW who                                           died after September 30, 1999
 
The change is significant because prior to the signing of the Act on August 6, 2012, only those whose spouses died of military-related causes were considered for home loan benefits. 
 
Generally, VA home loan eligibility for surviving military spouses has been updated to include widows who have not remarried and:
 
  • Survived a spouse who died in service or from a service-related disability
  • Survived a spouse who was missing in action (MIA) or a prisoner of war (POW)                                                 for at least 90 days (limited to one-time use of benefit)
  • Survived a spouse who was rated continuously totally disabled for the specified                                        period of time, and was eligible for disability compensation at the time of death by any cause

VA Home Loans for Surviving Spouses

Surviving spouses eligible for VA home loans may obtain government-backed mortgages of up to $417,000 (more in some areas). The advantages that accompany VA loans can make them an affordable option when purchasing or refinancing a home. Military widows can expect:
 
  • No VA funding fee
  • As little as zero down on purchase loans up to $417,000
  • Up to 100% refinancing of appraised value
  • No monthly mortgage insurance premiums
  • Low interest rates that are nationally competitive
  • No penalties for early payoff or balance reduction
  • VA Streamline refinancing even if ineligible for full VA loan benefits
 
Valery Behr, military community liaison for iFreedom Direct® says, “The improvements to VA loans as a result of this Camp Lejeune law are a great start to what’s needed to take better care of our vets.”  
 
Even if you may not have been eligible in the past, you may qualify now based on recent improvements to veterans’ benefits eligibility requirements.