There is a misconception currently out there that VA Loans are only for veterans. That is just simply not true. VA loans can also be used by active duty personnel. According to Bankrate, the VA guaranteed 85,000 loans last year for service personnel, which was a 24 percent increase from the previous year. But with a VA loan, there are still eligibility requirements.

Eligibility for a VA Loan

To get a full rundown of the eligibility requirements for a VA loan, you can visit the VA website that details this benefit here. Basically, prospective buyers that have served at least 90 consecutive days of active duty can be eligible. The only way to know for sure that you are eligible is by receiving a Certificate of Eligibility (COE) from the VA. You also need to have satisfactory credit and a sufficient income. You do not need to have the COE to begin the process, and your VA lender will typically help you obtain it if you do not have it already.

If you are no longer active duty, then you will need to provide a copy of your discharge and separation paperwork, also known as a DD-214, when you are attempting to acquire that COE. For active duty buyers, you will need to craft a Statement of Service. There is no real template for this letter, but you typically put them together on an official military branch letterhead and include things like your full name, social security number, the date you entered for active duty and will need your commanding officers signature.

Basic Allowance for Housing (BAH)

Lenders will use your Leave and Earnings Statement to obtain a better view of your income. According to Veterans United Network, you may be able to count certain military allowances such as flight pay, combat pay, and hazard pay. You can also count their BAH when trying to qualify for a VA loan. The BAH rates change year to year and gauge several factors such as family size, location, and service history.

Requirements for Occupancy

A VA loan is used to help veterans and active duty members purchase a home that will operate as their primary residence. You cannot use them to buy other properties such as vacation homes or an investment property. The VA will typically want you living in the residence full time within in the first 60 days of closing. This can be difficult if you are on active duty and are deployed elsewhere, however, this requirement can be fulfilled by your spouse on your behalf. You may also need to look into Power of Attorney during the loan process. There are two types, general and specific, and depending on your situation, you may need on or the other. Your best bet is to talk to your loan specialist to see if you will need Power of Attorney and which one will suit your needs.