A Breakdown of VA Loan Benefits and Requirements

09.15.2020 | Category: Homebuying

Updated 11.7.23

Since 1944, the VA home loan has helped thousands of our nation’s bravest citizens achieve the dream of homeownership. Aimed at active-duty service members, veterans, eligible surviving spouses, and certain members of the National Guard and Reserves, the VA loan is a versatile loan that allows us to give back to those that serve our country. 

With competitive interest rates and $0 down payments, VA home loans aim to ensure the home buying process is as easy as possible for those who qualify. Additionally, VA loans offer reduced closing costs, no private mortgage insurance requirements, or penalties or prepayment, making it a great option for your home buying needs! 

The VA home loan has helped bring home ownership within reach for millions of active duty and veteran service member with relaxed credit requirements and qualifications. 

Benefits of a VA Loan

Eligible veteran and military homebuyers can take advantage of the following VA loan benefits: 

$0 Down Payment on VA Loans

One of the unique features to the VA loan is the lack of down payments requirement. This allows prospect homebuyers to finance 100% of their new home, reducing the amount of upfront costs when purchasing their new home. 

Competitive Interest Rates

Another great feature of this program is the competitive interest rate on VA loans, offering great value to our homebuyers. There are multiple factors that weigh in on the competitive interest rate options, including government support, which allows lenders such as Mutual of Omaha Mortgage to lend without needing to worry about defaulting.

Relaxed Qualifications 

The primary goal of a VA loan is to make homebuying an approachable process for veterans and active-service members alike—therefore, the approval requirements associated with a VA loan are often more lenient than other loan programs. These easier-to-meet qualifications include lower credit score requirements and flexible debt-to-income (DTI) ratios for veterans. 

No Private Mortgage Requirements (PMI) 

For prospect homebuyers working on a budget, the private mortgage insurance (or PMI) requirement can impact how much home they can afford. However, with a VA home loan, there are no private mortgage insurance requirements even if you put less than 20% down on your home, unlike a conventional loan. This allows for no additional PMI costs adding to your monthly mortgage payments and can save you money in the long run. 

No Prepayment Penalty

Finally, VA loans do not include a prepayment penalty, allowing veterans to make additional payments each month without penalty. This will not only reduce the loan term, but it will also decrease the amount of money paid in interest payments over the life of the loan. 

Requirements for VA Loans

If you are unsure if you meet the service qualifications, we can help you! VA loan edibility requirements are broken down into three parts: 

  • Meet the service requirements set by the U.S Department of Veteran Affairs
  • Provide your Certificate of Eligibility (we can help you obtain this)
  • Meet the income and credit standards set by your lender

Once these three requirements are met, you may be eligible to become approved for a VA loan.   

How to Understand Service Requirements

The service level requirements for a VA loan are based around when and how long you served. You may be eligible for a VA loan if you have served: 

  • 90 consecutive days during wartime
  • 181 consecutive days during peacetime
  • 6 years in the national guard or reverses
  • Have an eligible surviving spouse. 

Below are some additional helpful details regarding VA eligibility: 

Active-Duty Service Personnel 

If you are currently on active duty, eligibility can be established after 90 days of continuous active-duty service. Upon discharge or release from active duty, eligibility must be reestablished. 


To help breakdown the VA loan qualification requirements for veterans, check out the below chart documenting the different service tenures:


Qualifying Wartime & Peacetime Periods

Qualifying Active Duty Dates

Minimum Active Duty Service Requirement



09/16/1940  –  07/25/1947

90 total days


07/26/1947 – 06/26/1950

181 continuous days

Korean War

06/27/1950– 01/31/1955

90 total days

Post-Korean War

02/01/1955 – 08/04/1964

181 continuous days

Vietnam War

08/05/1964– 05/07/1975

*For Veterans who served in the Republic of Vietnam the beginning date is 02/28/1961

90 total days

Post-Vietnam War

05/08/1975 - 09/07/1980

*The ending date for officers is 10/16/1981

181 continuous days

24-month rule

09/08/1980 - 08/01/1990

*The beginning date for officers is 10/17/1981

24 continuous months. – OR

The full period (at least 181 days) for which you were called or ordered to active duty

Gulf War

08/02/1990 - Present

24 continuous months. – OR

The full period (at least 181 days) for which you were called or ordered to active duty


National Guard & Reserve Member (08/02/1990 – Present)

Six years of service in the Selected or National Guard, AND

  • Were discharged honorable, OR
  • Were placed on the retired list, OR
  • Were transferred to the Standby Reverse or an element of the Ready Reserve other than the Select Reverse after service characterized as honorable, OR
  • Continue to serve in the Select Reserve

You May Also be Eligible for a VA Loan if: 

  • You are un-remarried spouse of a Veteran who died while in service or from a service-related disability
  • You are a spouse of a Service Member missing in action or a prisoner of war
  • You are a surviving spouse in receipt of Dependency and Indemnity Compensation (DIC) benefits in cases where the Veteran’s death was not service-related

Additional VA Loan Requirements

In addition to a service level requirement as listed above, you will also require you to meet certain financial requirements, including income and credit, to qualify for a VA loan. Those requirements include: 

Reliable Income

To show a lender that you are not at risk of loan default, it is important you can provide proof of a consistent and stable income source that will allow you to make your monthly mortgage payments. 

Credit Score

VA loans typically have easier to meet credit requirements when compared to most conventional loans. Generally, lenders will look for a credit score of 620 or higher. If you are unsure, you can always contact a local Mutual of Omaha Mortgage officer to see if you qualify for a VA loan.

VA Loan Limit 

The average loan limit with a VA loan in the United States is up to $726,200. It is crucial for potential homebuyers to verify their VA loan amount can cover their home’s cost without surpassing the lender limit. For example, Mutual of Omaha Mortgage offers a loan limit of up to $1.5 million for well-qualified borrowers. 

VA Property Requirements

Another requirement to the VA loan is, to qualify, the property being purchased must be your primary residence. However, it can also be used to purchase a one- to four-unit home if you plan to make one of those units your primary residence. 

Purchasing a Condo

A VA loan can also be used to purchase a condo if the condo has been approved by the Department of Veteran Affairs. The requirements that a condo must meet to be approved include: 

  • At least 50% of the units in the complex must be occupied by their owners 
  • 75% if the condo community must be current on their HOA payments

Additionally, the VA will not approve a condo unless more than 75% of the units in the complex have been sold. 

If you still have questions, one of our Mutual of Omaha Mortgage VA home specialists would be happy to help you assess your VA loan eligibility and review your home loan financing options today. 

Occupancy Requirements for VA Loan Eligibility

It is important to reiterate, if you plan on utilizing a VA loan to purchase a new home, that home must be your primary residence and cannot be used for a secondary or investment property. 

The VA requires that you move into your home within 60 days of your VA loan closing, or within a year, with an acceptable reason for delay. It is also important to note that your spouse is considered an extension of the veteran; therefore, they can also help you reach the occupation requirements established. 

Additionally, you must stay in your new home for at least one year or have a valid change in circumstance. Valid changes in circumstances can include instances such as: job transfer/relocation, divorce, family size change, or death. Ensure if you plan on leaving your home, you have a valid change in circumstances and not just a general excuse to move. 

If you’re serving or have served in the military and are looking to purchase a home, a VA loan could be an incredible benefit for you to consider. If you have any questions, feel free to contact Mutual of Omaha Mortgage loan officer to determine your VA eligibility. Give us a call today at 1-800-24-RATES (1-800-247-2837).

* Loan cannot exceed fair market value and the consumer may also be responsible for paying closing costs. It is recommended to consult your tax advisor before applying for a VA loan.

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