A VA Loan Certificate is your proof of achievement and shows that you are qualified to receive your VA loan benefits. You may be eligible for a VA mortgage if you have completed or are currently serving in the military. Veteran’s spouses may also receive certain benefits that require a Certificate of Eligibility. This article explains how it works when needed and how to apply for this important document that is essentially the start of the VA loan process. If you want to learn more about VA loans in general, read this one complete guide to VA loans.
What is the VA Loan Certificate of Eligibility?
The VA Loan Certificate of Eligibility is also known as the VA Loan COE. It’s a simple, short document that every VA lender must see before they can take out a VA-Backed Home Loan. Getting your VA Certificate of Eligibility as a first step is a good idea before you meet a loan officer.
Your COE is issued by the U.S. Department of Veterans Affairs. The COE will notify the lender that you have met the department’s requirements and are qualified to receive your VA home loan benefit. It can be submitted with your application to a financial institution of your choice. If you are planning on buying a home, you should apply for your COE during the pre-qualification process.
Who Qualifies for a VA Loan Certificate of Eligibility?
The eligibility requirements for the VA Loan Program and required Certificate of Eligibility are fairly straightforward, especially for an active duty member. Veterans must have served for a specified period of time. Your service status is also taken into account and your active duty service needs are calculated based on the time you served. You must have received an honorable discharge.
If you served 181 days or more in peacetime or 90 days in wartime, you are eligible. If you’ve served in the National Guard or Reserve, you can receive your COE. The veteran’s requirement in this case is six years of service. If you are a surviving spouse of a member who died in the service, you are also eligible for a COE.
It is important to remember that the VA does not actually grant the loan, it only guarantees or secures those loans, does not set the interest rates or minimum credit rating, and other qualifications that the individual mortgage lender performs much like a conventional loan. When you apply for a VA backed home loan, the individual private lender has their own additional requirements that you must meet. For example, they have loan income requirements and ask about your creditworthiness to determine your loan limits.
Get your COE
If you meet the VA loan service requirements, there are a few different ways you can get your Certificate of Eligibility. You can use the … VA’s Ebenefits service or on the VA website to apply for your VA home loan certificate.
Veterans wishing to apply for their COE will need a copy of their DD214. The DD21 is also known as the discharge document or separation paper.
Activated members of the Reserve or National Guard also need a copy of their DD214. This is required regardless of whether they are currently being served or earlier.
The President may activate Reserve or National Guard members and keep them on active duty for one year for any mission deemed necessary. Active duty members who require their COE must submit a statement of service signed by their personnel officer, commanding officer, or adjutant.
The service description shows the following:
- The name of the command that will provide the information
- Your full name
- Your date of birth
- The duration of a lost time
- Your social security number
- The date you started work
If you are currently serving in the National Guard or Reserve and have not been activated, you do not need to submit your DD214 when applying for your COE. Instead, you also need a description of services. This should include the same details as the statement of services for other active service members described above. If you have not been activated but are currently serving in the National Guard or Reserve, you will need to submit the Declaration of Service.
The Declaration of Service is an official document and confirms that you are employed in the military. Your commanding officer should have access to official letterhead that can be used with the document, indicating that it was from someone in the armed forces familiar with your service. Your commanding officer can provide other information about the letter, such as:
- Current deployment
- Date of separation (if any)
If you have been honorably discharged, the letter may contain your request to re-register. Military-related sources of payment such as special allowances, parachute allowances and flight allowances may also be included in the letter.
Dismissed members of the National Guard and the reserves
If you’ve served in the National Guard or the reserves but have been discharged, your records will be slightly different from those of a member currently serving. If you’ve been released from reserves and never activated, you will need a copy of your most recent annual retirement points to receive your COE. You will also need proof of your honorable service.
If you are a discharged National Guard member who has never been activated, you will need your NGB Form 22. This is your report of the separation and record of service for each period of National Guard service. You will also need NGB Form 23, known as the Retirement Points Statement. This should be accompanied by proof of service character.
A surviving spouse can apply for a COE. To do this, they need a copy of their spouse’s DD214. Some spouses may receive Dependency and Indemnity Compensation (DIC). In this case, they must submit an application for the grant of the loan guarantee, also known as VA Form 26-1817.
Some surviving spouses do not receive benefits. In this case you need to send:
- A completed application for DIC benefits, death benefit, and accrued benefits
- A copy of their marriage certificate
- The veteran’s death certificate
Is a VA Loan Eligibility Certificate the same as a DD214?
No. A D214 and VA Loan Certification Certificate are two different documents. In some cases, a DD214 may be required to apply for a COE. For example, if you are a member of the National Guard but are not active, you will need a DD214 to apply for your COE.
A DD214 can also be used to provide certain college education benefits. You can also use it to provide veteran’s funeral benefits, medical benefits, and even a veteran’s preference for hiring. Training is also easier with your DD214.
Some lenders will ask you to submit your COE, DD214, and personal information when applying for a loan. Neither of these documents is a substitute for the other. Your DD 214 resembles an employment letter filed by a civilian. The COE serves a different purpose and shows that you have met the service requirements for a VA-backed loan.
If a veteran has passed away or is otherwise unable to apply for their DD214, it can be obtained from their closest relative or other authorized person. There are several ways to do this, depending on the size of the requests, federal funding, staff, and other variables.
Why is your COE saying $ 36,000?
If you find that your COE reads $ 36,000, that number is your basic entitlement, and not a limit on the amount of money you can borrow. It indicates that the person making the request has full authority. This number is a notification to the lender that the VA will secure your loan up to a certain amount.
If you borrow less than $ 144,000 and default on the loan for any reason, the lender has a guarantee that it will be repaid up to $ 36,000. If your loan is more than $ 144,000 and you are in default, up to 25% of that amount will be paid back to the lender.
Eligible Veterans may not have a limit on loans over $ 144,000. There is also no longer a limit on loans over $ 144,000 for full service members and survivors. Individuals in all of these groups are not required to make a down payment, and their lender is guaranteed that the bank will repay up to 25% of the loan if the veteran defaults.
Can your COE expire?
The VA Loan Certificate of Eligibility gives you access to home loans on discounted terms. However, it never expires. If your status changes you will need a COE to reflect that. This means that veterans who received their COE while on active duty will need to get a new COE after they are released.
Do you need a COE for an IRRRL?
A refinancing loan to cut interest rates (IRRRL) allows some members of the military to refinance at a lower interest rate. This can also apply to their spouses. You can also use it to convert from an ARM to a fixed rate mortgage. The refinancing costs can usually be covered.
The VA does not need a COE for an IRRRL. When you print the IRRRL case number screen, all the required information is displayed. If a veteran needs to update or update their information, the COE can be used for that purpose.