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Surviving spouse VA loan eligibility

US flagA surviving spouse of a veteran may qualify for a VA loan if the spouse meets the credit and income guidelines and has a valid Certificate of Eligibility (COE).

The Veteran's Administration does not provide mortgages directly to eligibility veterans, but works with approved lenders to provide the funding for home purchases. The veteran must have a satisfactory credit score and credit history that is acceptable to the lender. Most VA lenders require a 620 minimum credit score.

The veteran should have a two year work history and meet the VA debt to income ratio of 41%; and meet an additional income test called residual analysis. Debt to income means that when all the monthly debt is added up (with the proposed mortgage payment), the total monthly debt is at or less than 41% of the gross monthly income. Here's an example:

VA Debt To Income Ratio
Proposed mortgage payment $1,125.00
Car payments $625.00
Credit card minimum payment(s) $350.00
Student loans $550.00
TOTAL $2,650.00
   
Gross monthly income $4,416.67
   
Debt ratio 2,650 / 4,416.67

The veteran must meet the service eligibility requirements. The Certificate of Eligibility (COE) determines whether the veteran (or other qualified applicants) are eligible for a VA-guaranteed home loan. The home must be for personal occupancy. The VA only guarantees single family residences. No duplexes, tri-units or four units are permitted for a VA home loan.

VA home loans can be used to:

  • Buy a home, or a condominium unit in a VA-approved project
  • Build a home
  • Simultaneously purchase and improve a home
  • Improve a home by installing energy-related features or making energy efficient improvements
  • Buy a manufactured home and/or lot
  • To refinance an existing VA-guaranteed or direct loan for the purpose of a lower interest rate
  • To refinance an existing mortgage loan or other indebtedness secured by a lien of record on a residence owned and occupied by the veteran as a home.
SOURCE: U.S. Department of Veterans Affairs

Basic eligibility requirements for wartime and peace time

The following tables provide a quick reference for a VA home loan. The tables are NOT exhaustive. The eligibility for a home loan benefits may only be determined by the Veteran's Administration. The VA provides additional eligibility information on the VA web site.

VA eligibility table

Additional eligibility reference table

Additional veteran eligibility

Rotating question mark  Frequently Asked Questions About VA Loan Eligibility

Q. Do I have to be a first time home buyer for a VA loan?
A. The VA home loan can be used by first time home buyers and non-first time home buyers.

Q. Am I guaranteed a mortgage by the VA?
A. The word guarantee is intended for the VA lender, not the veteran. The Veteran's Administration guarantees that the VA will reimburse the lender a percentage of the loan if the veteran defaults on the mortgage. The lender must meet all of the typical purchase requirements like any other mortgage applicant.

Q. Is there a down payment with a VA loan?
A. There are lending limits with the VA home loan. The loan limits are set annually by Congress. If the loan amount exceeds the lending limit, then the veteran may have to make a down payment.
See VA loan calculator

Q. Do I have to pay PMI with a VA loan?
A. One of the benefits of a VA home loan is that no monthly mortgage insurance (MIP) or private mortgage insurance is necessary. There is however, a "funding fee". The funding fee is paid by all veterans, except veterans who are considered at least 10% service related disabled or have been awarded the Purple Heart.