Many National Guard members have used the VA loan program to purchase a home, and the reasons are generally the same. This program allows eligible borrowers to purchase a house with no down payment and no mortgage insurance, among other benefits.
This article explains the minimum VA loan requirements for National Guard members, including the necessary documents and time-in-service requirements.
VA Loan Requirements for National Guard
Buying a home can be challenging, especially for first-time buyers who don’t have a lot of money saved up for a down payment. The down payment for a median-priced home in the U.S. can easily exceed $20,000, and more than that in pricier real estate markets.
Fortunately, military members and veterans with a certain amount of service can avoid the down payment altogether, by using the VA loan program. This is one of the only mortgage programs that allows you to finance up to 100% of the purchase price.
National Guard members can also use the VA loan program, but the eligibility requirements are a bit different when compared to regular activity-duty military personnel.
There are two main ways that National Guard members can qualify for VA loans:
1. Active Duty Service
You must have served at least 90 days of active duty under Title 10 orders. This includes deployments, training, or other federal service outside of your regular Guard duties.
At least 30 of those days must be consecutive. Your DD214 document should reflect this service with the appropriate activation codes.
2. National Guard Service
You must have completed at least six years of honorable service in the National Guard. This includes both your initial training and ongoing participation in drills and other activities.
There is no requirement for active duty service under this path.
(Note: You can learn more about these and other program requirements on the U.S. Department of Veterans Affairs website.)
If you are a current or past member of the National Guard and meet the VA loan requirements summarized above, the next step is to obtain your Certificate of Eligibility. So let’s talk about how you would go about doing that.
How to Obtain Your Certificate of Eligibility
To qualify for a VA-guaranteed mortgage loan, National Guard members must obtain a valid Certificate of Eligibility (COE) from the Department of Veterans Affairs. This document verifies your service and confirms your VA loan eligibility for the lender.
This is one of the most important documents for borrowers, because it paves the way for the rest of the application and approval process. You can’t move forward until you obtain your COE.
The process for requesting a COE can vary based on your National Guard service and status, as explained below.
1. Current or former activated National Guard member
If you’re a current or former activated National Guard member, you’ll need a copy of your DD214 or other discharge documents. If you have at least 90 days of active-duty service (including a minimum of 30 consecutive days), you’ll need a copy of either your DD214 or DD220 showing your date of activation.
2. Current member of the National Guard who has never been activated
If you are currently serving in the National Guard and have never been activated in the past, you’ll need to obtain a statement of service signed by your commander, adjutant, or personnel officer. It should include your name, SSN, DOB, and information relating to your length of service. Your personnel department should be very familiar with this process.
3. Discharged member of the National Guard who was never activated
If you were discharged with no active duty time in the past, you will need to obtain a “Report of Separation and Record of Service” (NGB Form 22) along with your “Retirement Points Statement” (NGB Form 23).
Again, you can find additional information about the COE request process on the Department of Veterans Affairs website. But we’ve covered most of the key points above.
General VA Loan Requirements
Apart from the service-related criteria mentioned in this article, National Guard members must also meet standard VA loan requirements. Here’s an overview of those checkpoints.
Credit Score: The Department of Veterans Affairs does not set a minimum credit score for borrowers who use VA loans. But your mortgage lender might have a minimum score requirement for home loan applicants.
Sufficient Income: Borrowers must also demonstrate that they have stable and sufficient income to cover their monthly mortgage payments. Your lender will review your current income status to make sure you have the financial ability to repay the loan. This is true for National Guard, active duty and Reserve members.
Manageable Debt: The debt-to-income ratio is another important requirement for National Guard members seeking VA home loans. It shows how much of your income you are using to cover your recurring debts. The VA prefers borrowers to have a DTI ratio no higher than 41%. But they allow lenders to make exceptions if the borrower has certain compensating factors.
It’s worth mentioning that VA loans are one of the easiest types of mortgage loans to qualify for these days. Mortgage lenders who offer these loans to their clients receive a partial guarantee from the federal government, which reduces their risk. As a result, lenders can be more flexible when reviewing and approving VA loan borrowers.
Bottom line: If you’re a current or past member of the National Guard and plan to buy a home in the near future, you owe it to yourself to at least consider the VA loan program. It offers many benefits you just won’t find anywhere else.