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VA LOAN BUYERS

MYTHS & MISCONCEPTIONS

For military home buyers using their VA Loan benefits to purchase a home, we know there are plenty of questions and details about the process. Flotilla's Military Division Partners are here to help guide you and your family through the process.We've compiled tools such as a Basic Housing Allowance calculator, frequently-asked questions, and tools to start your search, including a school ratings tool!Contact Flotilla at (405) 977-0207, or email us at military@flotillarealty.com—we'll put you in touch with an MRP certified REALTOR®.

VA RESOURCES

BASIC HOUSING ALLOWANCE

The Basic Allowance for Housing (BAH) provides service members who are living in or permanently stationed in the United States with housing cost assistance. Military members serving overseas receive a different type of housing allowance called the Overseas Housing Allowance (OHA).

Military service members will see an average increase of 5.4% in the Basic Allowance in 2024.

The increase is an average for all areas and actual rates will vary by military members’ duty station zip codes. Veterans using the Post-9/11 GI Bill receive BAH based on their school’s zip code.

BAH covers 95% of housing expenses while service members pay the remaining 5% out of pocket. The out-of-pocket expense amounts incorporated in the 2023 BAH rates vary by grade and dependency status.

The BAH calculated here works for all branches of the US military, including the Army, Navy, Air Force, Marines, and Coast Guard.

SCHOOL RATINGS

VA BUYER FAQs

Does the VA require a minimum credit score?

NO. The VA does not have a minimum credit score requirement. Each lender may have a minimum credit score overlay depending on their acceptance of risk, however, credit score limits are not driven by the VA. If your credit score is marginal or too low, continue to shop lenders as they will all be different.

How do I apply for a VA-guaranteed loan?

You can apply for a VA loan with any mortgage lender that participates in the VA home loan program. At some point, you will need to get a Certificate of Eligibility from VA to prove to the lender that you are eligible for a VA loan.

How do I get a certificate of eligibility?

Complete a VA Form 26-1880: Request for a Certificate of Eligibility, and submit it to the Atlanta Eligibility Center along with proof of military service. In some cases it may be possible for VA to establish eligibility without your proof of service. However, to avoid any possible delays, it's best to provide such evidence.

Can my lender get my certificate of eligibility for me?

YES, it's called Web LGY. Most lenders have access to the Web LGY system. This internet-based application can establish eligibility, and issue an online Certificate of Eligibility in a matter of seconds. Not all cases can be processed through Web LGY—only those for which VA has sufficient data in its records. However, veterans are encouraged to ask their lenders about this method of obtaining a certificate.

What is acceptable proof of military service?

If you are still serving on REGULAR ACTIVE DUTY, you must include an original Statement of Service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which identifies you and your social security number, and provides your date of entry on your current active duty period & the duration of any time lost.
If you were discharged from REGULAR ACTIVE DUTY after January 1, 1950, a copy of DD Form 214: Certificate of Release or Discharge From Active Duty should be included with your VA Form 26-1880.
If you were discharged after October 1, 1979, DD Form 214 Copy 4 should be included. A PHOTOCOPY OF DD214 WILL SUFFICE. DO NOT SUBMIT AN ORIGINAL DOCUMENT.
If you were discharged from the ARMY or AIR FORCE NATIONAL GUARD, you may submit NGB Form 22: Report of Separation and Record of Service or NGB Form 23: Retirement Points Accounting or its equivalent.
If you are still serving in the SELECTED RESERVE or the NATIONAL GUARD, you must include an original Statement of Service signed by, or by the direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters showing the length of time that you have been a member of the Selected Reserve. Again, at least 6 years of honorable service must be documented.
If you were discharged from the SELECTED RESERVE, you may submit a copy of your latest Annual Points Statement and evidence of honorable service. Unfortunately, there is no single form used by the Reserve or National Guard similar to the DD Form 214. It is your responsibility to furnish adequate documentation of at least 6 years of honorable service.
If you were discharged from the SELECTED RESERVE or the NATIONAL GUARD, you must include copies of adequate documentation of at least 6 years of honorable service.

How can I obtain proof of military service?

Standard Form 180: Request Pertaining to Military Records is used to apply for proof of military service regardless of whether you served on Regular Active Duty or in the Selected Reserve. This request form is NOT processed by VA. Rather, Standard Form 180 is completed and mailed to the appropriate custodian of military service records. Instructions are provided on the reverse of the form to assist in determining the correct forwarding address.

I have already obtained one VA loan. Can I get another one?

YES, your eligibility is reusable depending on the circumstances. Normally, if you have paid off your prior VA loan, and disposed of the property, you can have your used eligibility restored for additional use. Also, on a one-time only basis, you may have your eligibility restored if your prior VA loan has been paid in full but you still own the property.In either case, to obtain restoration of eligibility, the veteran must send a completed VA Form 26-1880 to the Atlanta Eligibility Center. To prevent delays in processing, it is also advisable to include evidence that the prior loan has been paid in full and, if applicable, the property disposed of. This evidence can be in the form of a paid-in-full statement from the former lender or a copy of the HUD-1 Settlement Statement completed in connection with a sale of the property or refinance of the prior loan.

I sold the property I obtained with my prior VA loan on an assumption. Can I get my eligibility restored to use for a new loan?

In this case the veteran's eligibility can be restored only if the qualified assumer is also an eligible veteran who is willing to substitute his or her available eligibility for that of the original veteran. Otherwise, the original veteran cannot have eligibility restored until the assumer has paid off the VA loan.

My prior VA loan was assumed, the assumer defaulted on the loan, and VA paid a claim to the lender. VA said it wasn't my fault, and waived the debt. Now I need a new VA loan, but I am told that my used eligibility cannot be restored. Why?

OR…

My prior loan was foreclosed on, or I gave a deed in lieu of foreclosure, or the VA paid a compromise (partial) claim. Although I was released from liability on the loan and/or the debt was waived, I am told that I cannot have my used eligibility restored. Why?

In either case, although the veteran's debt was waived by VA, the government still suffered a loss on the loan. The law does not permit the used portion of the veteran's eligibility to be restored until the loss has been repaid in full.

Only a portion of my eligibility is available at this time because my prior loan has not been paid in full even though I don't own the property anymore. Can I still obtain a VA-guaranteed home loan?

YES, depending on the circumstances. If a veteran has already used a portion of his or her eligibility, and the used portion cannot yet be restored, any partial remaining eligibility would be available for use. The veteran would have to discuss with a lender whether the remaining balance would be sufficient for the loan amount sought, and whether any down payment would be required.

Is the surviving spouse of a deceased veteran eligible for the home loan benefit?

The unmarried surviving spouse of a veteran who died on active duty or as the result of a service-connected disability is eligible for the home loan benefit. If you wish to make application for the home loan benefit as a surviving spouse, contact the Atlanta Eligibility Center. In addition, a surviving spouse who obtained a VA home loan with the veteran prior to his or her death (regardless of the cause of death), may obtain a VA-guaranteed Interest Rate Reduction Refinance Loan. For more information, contact the Atlanta Eligibility Center.NOTE: Also, a surviving spouse who remarries on or after attaining age 57 and on or after December 16, 2003 may be eligible for the home loan benefit. However, a surviving spouse who remarried before December 16, 2003 and on or after attaining age 57 must apply no later than December 15, 2004 to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 16, 2003 that are received after December 15, 2004.

Are the children of a living or deceased veteran eligible for the home loan benefit?

NO. Children of an eligible veteran are not eligible for the home loan benefit.

Does the VA do an inspection of the home?

NO. The VA does not do a full inspection of the home, so it is highly recommended that the buyer hire a licensed home inspector prior to purchase. A VA appraiser will look for Minimum Property Requirements relating to safety, soundness, and sanitation. The appraiser can require repairs in order for the loan to be processed if they see a defect in any one of these three areas.

Is the seller required to accomplish repairs required by the appraiser?

NO. Either the buyer or seller may pay for the repair. Additionally, if the veteran disagrees with the requirement, and is willing to accept the home with the defect, they can request a waiver of the requirement from the VA regional loan center.

If the house doesn’t appraise, what are my options as a buyer?

If you and your REALTOR® disagree with the valuation, you can work with your lender to file a Reconsideration of Value with the VA. This typically takes a couple of weeks but can raise the value of the appraisal and the amount of mortgage you will be guaranteed. The other option is to renegotiate terms with the seller, and possibly bring cash to closing for the amount between the appraised value and the final sales price.