How to Apply for a VA Loan: A Step-by-Step Guide for Borrowers

This article is part of a comprehensive series that delves into various VA home loan process facets. These loans are accessible to military members, veterans, and eligible spouses, presenting numerous advantages, such as purchasing a home with no down payment for VA loan.

Today, we will walk through the different steps and stages of the VA loan application process. By the time you finish reading this article, you’ll know what steps you need to take to apply for a VA-guaranteed mortgage loan, answering the question of how to apply for a VA loan.

Navigating the VA Loan Application Process

The VA loan application process closely resembles that of other mortgage loans. You’ll complete a standard application form and provide the necessary financial documents to determine your maximum loan amount. 

However, there are specific steps unique to VA home loans, so let’s break down the process step by step.

1. Review the Basic Eligibility Requirements

The initial step is to review the fundamental VA loan credit score and eligibility criteria. This will give you a better sense of whether you are qualified for it.

If you’re an active military member, your personnel or administrative office can provide information about your eligibility. Additionally, you can independently review the eligibility criteria to assess your qualifications for the program.

If you satisfy one or more of the following VA loan application requirements, you could be eligible for a VA loan:

• During the war, you served 90 days of continuous active service.
• Throughout peacetime, you were on duty for 181 days.
• You have 6 years of service in the National Guard or Reserves or served 90 days (at least 30 consecutively) under Title 32 orders.
• You are the surviving spouse of a military member who passed away or became disabled due to their service.

To gain a more comprehensive understanding of these minimum requirements, you can visit the eligibility section of the U.S. Department of Veterans Affairs website.

2. Get your Certificate of Eligibility from the VA

If you meet the basic VA loan eligibility criteria, the next step in the VA home loan application process is to obtain your Certificate of Eligibility (COE). The Department of Veterans Affairs provides this official government document and confirms to your lender that you meet the VA home loan benefit requirements.

You can request this document independently or have your mortgage lender handle it for you. In recent years, the VA has simplified the Certificate of Eligibility request process, allowing you to request online by providing some basic information about yourself.

For security purposes, ensure you are on the official VA website before entering any private information.

3. Establish a Monthly Housing Budget

While it’s not mandatory, establishing a budget before applying for a VA loan is wise. Creating a basic housing budget can offer several advantages, such as preventing you from taking on excessive debt or overspending on a home that exceeds your monthly financial limits.

You don’t need a CPA or financial planner to establish a home-buying budget. All you need to do is review your net income (or “take-home pay”) in relation to your recurring monthly expenses.

Some financial advisors recommend adhering to the “28/36 rule” when buying a home. The goal is to keep your monthly mortgage payment and total monthly debt payments (including the mortgage payment) to no more than 28% and 36%, respectively, of your gross monthly income.

While this is a general guideline, individual situations can vary. Depending on your income and financial situation, you may be comfortable with a higher level of debt.

In any case, it’s crucial to have a clear understanding of your monthly housing cost limits before applying for a VA loan.

4. Locate a VA-approved Mortgage Lender

The Department of Veterans Affairs does not provide direct loans to borrowers. So, when you’re ready to apply for a VA loan, the next step in the process is to choose a lender who participates in this program.

As it states on the VA.gov website:

“The Department of Veterans Affairs does not take applications, approve the loans, or issue funds. Private banks, credit unions, and mortgage companies do that. The VA provides insurance to lenders.”

Fortunately, most banks and mortgage companies that offer general home loans also offer VA loans, making it easy to find a lender.

I specialize in VA loans and can guide you through the home-buying process. However, I recommend obtaining 1 or 2 additional quotes for comparison, as it’s a prudent practice. If you require my personal assistance, don’t hesitate to reach out, as I’m passionate about assisting fellow veterans.

5. Submit a Standard Loan Application

When you apply for a VA loan, you’ll use the same standard document that’s used for other types of mortgages. It’s called the “Uniform Residential Loan Application,” or URLA. This VA loan application form necessitates a substantial amount of information from you as the borrower.

Additionally, it includes details about the home you intend to purchase. When you initiate the VA loan application, you may not have chosen a specific home yet, which is perfectly acceptable.

You can complete the relevant sections of the application to commence the process. Later, after you’ve identified a home and entered into a purchase agreement, you can furnish the property-related information to finalize the loan process.

6. Provide Financial Documents as Requested

Financial documents are an important part of the VA mortgage loan application and approval process. This is true whether you’re using a VA, FHA, or conventional home loan.

When you submit your VA loan application form, you will also be asked for a variety of documents relating to your income and finances. You’ll probably have to provide bank statements, tax returns, W-2 forms, pay stubs, and documents relating to other assets or investments you might have.

Your lender will provide you with a list of the specific documents they need to complete the VA loan application process. However, you can potentially expedite the process by proactively gathering these documents or researching how and where to obtain them. This can help you stay informed about your VA loan application status.

Once you’ve completed the initial steps in the VA loan application process, you’ll be able to move forward with the house-hunting stage. The property you wish to purchase will have to be appraised to determine its value and condition. You’ll also be given the choice to have a home inspection conducted.

Lastly, you’ll move on to the closing stage. This is when you’ll sign all the finalized VA loan application documents, cover your closing costs, and receive the keys to your new home!

This step-by-step guide provides you with the knowledge and confidence to navigate the VA home loan application process, opening the doors to homeownership for those who have served our nation.