VA Loan Requirements for 2025

Who Is Eligible for a VA Loan?

To qualify for a VA loan in 2025, you must meet a range of criteria, two of which are unique to VA loans: service history and a Certificate of Eligibility (COE).

Service Criteria

Active-duty service members are eligible for VA loans if they've served for at least 90 continuous days without a break in service. Veterans are eligible if the character of their discharge was other than dishonorable and they served a minimum amount of time in active duty that varies depending on when they served.

Veterans who served prior to 1980 have minimum requirements ranging from 90 days to 181 days. For those who served between 1981 and the present, the minimum is 24 continuous months, though there are exceptions with lower minimums for those discharged for hardships, reductions in force or a service-connected disability.

Surviving family members may also be eligible for VA loans if they meet certain requirements.

Certificate of Eligibility

Another unique requirement of VA loans, and the first step to getting one, is obtaining a COE. This provides proof to lenders that you meet the service requirement, and you can easily request your COE online through the VA.

VA Loan Financial Requirements

Beyond meeting eligibility requirements for military service and discharge characterization, applicants for a VA loan in 2025 must also meet some financial requirements. While VA loans don't require a minimum down payment, lenders do use their discretion to ensure you're creditworthy and capable of repaying the loan.

Employment and Income

The VA allows financial institutions to set their own employment and income guidelines for borrowers. Typically, lenders want to see proof of steady income or employment that is sufficient to cover your monthly loan payments.

Credit Score

The government doesn't require VA loan borrowers to have a minimum credit score. Lenders may set their own requirements, however, which may be more lenient than they would be with a conventional loan. The minimum FICO^® Score^☉ is typically between 620 and 670, though borrowers with lower credit scores could still get qualified in exchange for a higher interest rate (or a larger down payment).

Debt-to-Income Ratio (DTI)

Bringing home a hefty income looks different to a lender if you're also drowning in credit card debt. That's why in addition to confirming your income, VA lenders consider your debt-to-income ratio (DTI). This ratio shows how much of your monthly gross income is put toward your debt payments, like auto loans or student loans. VA lenders usually require a DTI of 41% or less.

Funding Fee

While VA loans lack down payment requirements, they do have a downside: the funding fee. This is a one-time fee paid at closing by VA loan borrowers to help cover the program cost to U.S. taxpayers, since there is no mortgage insurance or down payment costs. You can either pay the fee at closing in full or finance it by having it added to your loan and paying it off over time with your loan.

Your funding fee is typically a percentage of the total loan amount, though the fee amount may vary depending on whether it's your first time using a VA loan and if you choose to submit an optional down payment. As of 2023, if you opt for a down payment below 5% (including 0%) and it's your first time using a VA loan, your VA funding fee is 2.15% of the total loan amount. If you've used a VA loan before, though, that fee goes up to 3.3%.

The funding fee goes down significantly if you choose to put down more than 5%, and goes even lower if you put down more than 10%, but this may defeat the purpose of a VA loan for some borrowers. After all, according to the VA, 90% of their loans are made with zero down payment.

Certain individuals are exempt from paying a funding fee, such as veterans receiving VA compensation for service-connected disabilities or active-duty service members who are Purple Heart recipients.

Tip: If you plan to make a down payment and are looking for a home in a more expensive area, the VA funding fee could be prohibitively expensive. Getting quotes on both VA and conventional loans can help you see how the costs compare.

VA Loan Property and Occupancy Requirements

Another downside of VA loans is they have restrictions for the types of property that can be financed and how they will be occupied.

Property Requirements

VA purchase loans are permitted for the following property types:

• A single-family home with up to four units
• A condo in a VA-approved project
• A manufactured home or lot

You may also be able to use a VA loan for other needs, such as building a new home, buying and improving a home or making your home more energy-efficient.

Occupancy Requirements

To qualify for a VA loan, you must plan to use the home you're purchasing as your primary residence. VA loans cannot be used to buy a vacation home or investment property. In some situations, such as if you're active duty and deployed, you can still meet this requirement if your dependents live in the home full time.

How to Apply for a VA Loan in 2025

The process of applying for a VA loan in 2025 varies slightly from other types of loans, so make sure to follow these steps as you get started.

1. Confirm Your Eligibility

If you believe you're eligible for a VA loan, visit the VA's website to request your COE. It's possible the VA will ask you to provide additional information before they can issue you one.

2. Find a VA-Approved Lender

You can choose any lender that's approved by the VA and issues VA loans, including a bank, credit union or mortgage company. While the VA sets some requirements and fees, lenders are able to set their own interest rates and other fees, so it pays off to do some comparison shopping. If you can't find a VA-approved lender, contact your regional VA loan center.

3. Get Preapproved

Now it's time to submit your mortgage preapproval application. You can apply with multiple lenders to compare quotes, since one might offer a lower interest rate than others. If you get the green light, you'll receive a preapproval letter that shows sellers you're a serious and qualified buyer.

Once you find your perfect home, you'll complete the full application for a VA loan. A VA-approved appraiser is required to view the home to ensure it meets the VA's minimum property requirements. The VA wants to know that a home it's backing is a solid investment and meets basic property condition standards. This is in addition to any inspection you choose to do (which the VA highly recommends, and your lender might require anyway).

4. Receive Loan and Close

If all goes smoothly, you will receive your closing disclosure shortly before closing. You will have an opportunity to see your final loan details and ask questions about anything that's unclear. Then it's time to attend closing, where you will sign a hefty amount of paperwork, officially receive the loan and close on the home. Then it's time to move in!

Learn more: What Type of Mortgage Loan Is Best?

Frequently Asked Questions

The Bottom Line

For eligible borrowers, VA loans can be a money-saving blessing. Their perks don't come for free, though. The VA imposes strict limits on eligibility of borrowers and properties, and the percentage-based funding fee can render some of the other savings moot.

If you think you're eligible for a VA loan, it's still helpful to ask the lender to also prepare a quote for a conventional loan. Do some math and compare all the different fees and costs, including how they vary if you do or don't make a down payment, to ensure you score the best deal.

Keep in mind that the higher your credit score, the better terms a lender can offer you. If you know homebuying is on the horizon, consider using this time to build your credit and review your credit report for free with Experian.