First-time homebuyer - VA loan for veterans

The VA home loan program is widely considered the single best mortgage benefit available in the United States. Backed by the U.S.

54 steps across 12 sections

1. Verify Your Eligibility

  • Confirm your service history meets minimum requirements
  • Review your discharge status (DD-214)
  • Determine if you have full or partial entitlement

2. Obtain Your Certificate of Eligibility (COE)

  • Request online at VA.gov, through your lender, or by mail
  • Gather required documentation (DD-214, statement of service)
  • Your lender can often pull this electronically in minutes

3. Get Pre-Approved

  • Choose a VA-approved lender (shop at least 3 lenders for rate comparison)
  • Provide income documentation (pay stubs, W-2s, tax returns)
  • Lender reviews credit, income, DTI ratio, and residual income
  • Receive a pre-approval letter stating your maximum purchase price

4. Find a Home and Make an Offer

  • Work with a real estate agent experienced in VA transactions
  • The property must be your primary residence (not investment or vacation)
  • Property types eligible: single-family homes, condos (VA-approved), townhouses, manufactured homes (on permanent foundation), multi-unit properties (up to 4 units if you occupy one)
  • Include any negotiated seller concessions in your offer (sellers can pay closing costs)

5. VA Appraisal

  • The lender orders a VA appraisal through the VA's portal
  • A VA-assigned appraiser evaluates market value and checks Minimum Property Requirements (MPRs)
  • The appraisal typically costs $400-$700 depending on location
  • Timeline: usually 1-2 weeks
  • If the appraisal comes in low, you can negotiate price, pay the difference, or request a Reconsideration of Value (ROV)

6. Home Inspection (Strongly Recommended)

  • The VA appraisal is not a home inspection — get a separate independent inspection
  • A home inspection covers items the appraisal does not (HVAC condition, plumbing details, electrical systems, etc.)
  • Typical cost: $300-$500
  • Termite/pest inspection may be required by the VA in certain states

7. Underwriting and Loan Processing

  • The lender verifies all documentation, employment, and financial information
  • Underwriter reviews the appraisal, title search, and your complete file
  • May request additional documentation (bank statements, gift letters, etc.)
  • Clear-to-close issued once all conditions are satisfied

8. Closing

  • Review and sign the Closing Disclosure (received at least 3 business days before closing)
  • Pay any closing costs and the funding fee (if not financed into the loan)
  • Sign all loan documents
  • Receive the keys to your new home
  • Typical timeline: 30-45 days from accepted offer to closing

9. How to Obtain Your COE

  • Online through VA.gov - Fastest method; available at va.gov/housing-assistance/home-loans/how-to-request-coe/
  • Through your VA-approved lender - Most lenders can pull your COE electronically in minutes via the VA's Web LGY system
  • By mail - Submit VA Form 26-1880 with proof of service to the VA Regional Loan Center (slowest, takes several weeks)

10. What the COE Shows

  • Full entitlement or partial entitlement status
  • Amount of entitlement available
  • Prior VA loan usage
  • Funding fee exemption status (if applicable)

11. Funding Fee Exemptions (Pay $0)

  • Veterans receiving VA disability compensation (any rating)
  • Veterans eligible to receive VA disability compensation but receiving retirement or active-duty pay instead
  • Surviving spouses of veterans who died in service or from service-connected disabilities
  • Active-duty Purple Heart recipients
  • Veterans rated eligible for compensation based on a pre-discharge claim

12. Key MPR Categories

  • Foundation must be solid with no major cracks or settling
  • Roof must be in serviceable condition with no active leaks
  • No evidence of structural damage, wood-destroying insects, or dry rot
  • Crawl spaces must be accessible and properly ventilated
  • Adequate handrails on stairs and elevated areas
  • No lead-based paint hazards (especially in homes built before 1978)
  • Proper electrical systems (no exposed wiring, functional breakers)
  • No health/safety hazards (mold, asbestos concerns, radon above EPA action levels)
  • Smoke detectors installed per local code
  • Safe drinking water supply

Common Mistakes

  • Not shopping multiple lenders
  • Skipping the home inspection
  • Assuming you cannot use the benefit again
  • Not checking for funding fee exemption
  • Waiving the appraisal contingency in competitive markets

Pro Tips

  • File your VA disability claim before house hunting
  • Get your COE early
  • Use seller concessions strategically
  • Consider putting 5% down to reduce the funding fee
  • Request a Reconsideration of Value (ROV) if the appraisal is low

Sources

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