VA Loans And Your Certificate Of Eligibility: Is It Correct?

Before you can apply for a VA home loan for the first time, you will need to apply for a VA Certificate of Eligibility (COE). The COE tells the lender that you have served the minimum time required to be eligible for a VA loan, that you were not dishonorably discharged, and the amount of VA loan entitlement you have remaining for your VA loan.

These things are all important for VA loan approval. Contrary to popular belief, you remain eligible for a VA mortgage regardless of the nature of your military discharge (where applicable) UNLESS the discharge is categorized as dishonorable.

First time VA loan applicants will have 100% of their VA loan entitlement to use. Subsequent use borrowers will need to discuss the nature of the loan and their remaining entitlement with the lender to see what must happen to have the loan approved.

In some cases a borrower may be able to use “bonus entitlement”, in other cases a borrower may not need to have the entitlement restored when certain types of VA refinancing are applied for.

Borrowers who are on active duty will have or should have that status reflected on their VA COE, but if you applied for a VA Certificate of Eligibility while on active duty, but have since retired or separated from the military, you may need to have your status updated and have a new COE generated for the VA loan you wish to apply for.

The good news is that regardless of whether you need a new COE or need to have your current one updated to reflect your current military status of active duty, Guard/Reserve, retired, or separated, your loan officer can assist you in doing this.

Some borrowers may prefer to handle the COE issues themselves via the online forms available at the VA official site ( but if you want the lender to help, all you have to do is ask. All participating VA lenders have access to the VA web portal that allows new COEs or updated versions of them to be generated. You can work with your lender on COE issues for any type of VA mortgage including new purchase loans, VA Cash-Out refinancing, or Interest Rate Reduction Refinancing mortgages.

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