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VA Loan Requirements

These VA loan requirements help guide a veteran borrower’s ability to repay the loan as well as the lender’s ability to lend. Whether buying a home or refinancing an existing home you must know the restrictions that will allow you to make good long term financial decisions.

Eligible Property Types

VA loan requirements allow for single-family (SFR), townhouses (PUD), duplexes, 3 – 4 unit, and VA approved condos.

Seller Concessions

VA loan requirements allow for seller concessions of up to 4% of the sales price.

Reserves

VA does not have any financial reserve requirements on single family homes and duplexes with the exception of documenting automated findings.

Debt-To-Income Ratio

VA loan requirements allow for DTI ratios of 29% / 41%. These ratios may be slightly exceeded with acceptable Automatic Underwriting System (AUS) and underwriter’s approval.

Monthly Mortgage Insurance

VA loans do not require any monthly Mortgage Insurance (MI) payment.

VA Funding Fee

VA loan requirements call for an up-front VA Funding Fee as a percentage of the loan amount on both purchases and refinance transactions. If you are at least considered 10% disabled you are exempt from this fee. This fee is .5% of the loan amount for VA Streamline Refinances. For purchases or non-streamline refinances the fee is 2.15% for first time use and 3.3% for subsequent use.

Occupancy

VA loan requirements say that the property must be owner occupied. No investment property or second home ownership is permitted.

To speak with a VA loan benefits specialist, call the number above or fill out the short form and a specialist will contact you.