VA Home Loan Checklist: From Certificate of Eligibility to Closing Day

A VA-backed home loan is one of the most valuable benefits many veterans and service members ever use. No down payment in most cases, no private mortgage insurance, and no prepayment penalty can add up to real money. But the process has its own vocabulary—COE, entitlement, funding fee, Notice of Value, escape clause—and a string of deadlines once you're under contract.

This guide walks through the process in order, using what VA publishes on VA.gov and in its Home Loan Guaranty Buyer's Guide. It is not legal, financial, or lending advice, and Muster Desk is not affiliated with the Department of Veterans Affairs or any lender. Your lender sets your rate and approval; VA sets the program rules. Confirm current details on VA.gov before you rely on them.

Who this checklist is for

• Veterans and service members buying their first home with a VA-backed purchase loan
• Veterans who used the benefit before and want to buy again
• Spouses or family members helping a veteran stay organized

It covers VA-backed purchase loans from private lenders. VA also offers a Native American Direct Loan (NADL), an IRRRL refinance, and cash-out refinancing; those have different steps.

Step 1: Confirm the three basic requirements

On its purchase loan page, VA says you may be eligible for a VA-backed purchase loan if all of these are true:

1. You qualify for a VA home loan Certificate of Eligibility (COE)
2. You meet VA's and your lender's standards for credit, income, and any other requirements
3. You will live in the home you're buying with the loan

The COE is about your service. The credit and income part is about the lender. The occupancy part is about how you plan to use the house—a VA purchase loan is for a home you live in, not a pure rental.

Service requirements at a glance

VA's eligibility page lists minimum service by era. For veterans who served from August 2, 1990, to the present, VA lists any of these as meeting the minimum: at least 24 continuous months; the full period (at least 90 days) you were called or ordered to active duty; at least 90 days if discharged under a qualifying exception; or less than 90 days if discharged for a service-connected disability. Active-duty service members generally qualify after 90 continuous days. National Guard and Reserve members have their own paths, including 6 creditable years of service. Check the page for your exact situation.

Step 2: Request your Certificate of Eligibility (COE)

VA's COE request page says you can request a COE three ways:

• Online on VA.gov
• Through your lender, which may be able to pull it through VA's Web LGY system
• By mail with VA Form 26-1880, Request for a Certificate of Eligibility (VA notes mail can take longer)

What you need depends on your status. For most veterans it's simply a copy of your DD214. Active-duty members need a signed statement of service (name, SSN, date of birth, entry date, any lost time, and the command providing it). Guard and Reserve members may need DD214s, NGB Forms 22 and 23, retirement points statements, or a statement of service. Surviving spouses have separate forms. The VA page lists all of them.

Reading your COE

VA's entitlement and limits page explains the number on your COE:

• A basic entitlement of $36,000 means you have full entitlement. You don't have a VA loan limit, as long as you can afford the loan and the appraisal supports the price.
• That $36,000 is not how much you can borrow. It's what VA guarantees on loans of $144,000 or less. For loans above $144,000, VA guarantees up to 25% of the loan amount.
• If you've used entitlement before and haven't restored it, your remaining entitlement is calculated using the FHFA county loan limit. VA walks through an example on the same page.

Full entitlement still doesn't mean "any size loan." VA notes the lender decides how much you can afford based on credit, income, debts, and assets.

Step 3: Check your money before you shop

The VA Buyer's Guide recommends reviewing your credit, income, expenses, and budget before you shop, and including closing costs in the overall price. A few practical points from VA and the CFPB:

• Credit score: VA does not set a minimum credit score, but many lenders do. VA suggests contacting more than one lender to compare.
• Free credit reports: The official site is AnnualCreditReport.com. Check for errors early.
• Reserves: VA's Buyer's Guide says VA does not require extra cash for a set number of mortgage payments, but it suggests saving for surprises like a roof or appliances. A home with zero cushion left after closing is fragile.
• Total housing cost: Budget principal and interest plus property taxes, homeowner's insurance, any HOA fees, utilities, and maintenance.

If you're working from a tight budget, our bare-bones budget guide and debt snowball vs avalanche walkthrough can help you clear room before you apply.

Step 4: Understand the VA funding fee

The funding fee is a one-time charge, a percentage of the loan amount (not the purchase price). VA says it lowers the program's cost to taxpayers because VA loans don't require down payments or monthly mortgage insurance.

From VA's funding fee and closing costs page, purchase and construction loan rates (effective April 7, 2023) are:

VA's own example: first-time use, a $200,000 home, $10,000 down (5%). The fee is 1.5% of the $190,000 loan amount, or $2,850.

Who doesn't pay it

VA lists these exemptions. You won't pay the funding fee if:

• You receive VA compensation for a service-connected disability, or
• You're eligible for that compensation but receive retirement or active-duty pay instead, or
• You receive Dependency and Indemnity Compensation (DIC) as a surviving spouse, or
• You're a service member with a proposed or memorandum rating, before closing, saying you're eligible for compensation based on a pre-discharge claim, or
• You're on active duty and show you received a Purple Heart on or before closing.

VA also describes a refund path if you're later awarded compensation with an effective date before your loan closed. If you have a pending disability claim, that detail matters. Our guides on filing a VA disability claim and Intent to File cover that side.

You can pay the fee at closing or finance it into the loan. On a purchase loan, VA says the funding fee is the only cost you can finance. Other closing costs are paid at closing.

Step 5: Compare at least two or three lenders

VA backs the loan, but a private bank, mortgage company, or credit union makes it. VA says your lender sets the interest rate, discount points, and most closing costs, and these vary from lender to lender.

How to compare fairly:

• Ask each lender for a Loan Estimate. The CFPB says lenders must provide one within three business days of receiving your application.
• Request them close together so rates are comparable. VA's Buyer's Guide (citing CFPB) notes that multiple mortgage credit checks within a 45-day window count as a single inquiry on your credit report.
• Compare interest rate and APR, discount points, origination charges, total closing costs, lender credits, and how each lender shows the funding fee.
• Ask how many VA loans they close. Experience with VA appraisals and condo approvals saves headaches.

When you pick one, get a pre-approval letter before you shop seriously.

Step 6: Choose an agent and shop smart

VA's Buyer's Guide recommends meeting with several real estate agents, reading every agreement, and understanding all charges, fees, and commissions before you sign. Ask each candidate whether they've worked with VA buyers and whether they know the VA escape clause and appraisal process.

While touring, remember:

• Condos must be in a VA-approved project (or be submitted for VA review).
• VA purchase loans can be used for a single-family home up to 4 units, as long as you live in one.
• Score homes on the same criteria every time—price, taxes, HOA, age of roof and HVAC, commute, obvious repairs—so the decision isn't just a gut feeling at the third open house.

Step 7: Make an offer with VA protections in the contract

Two VA-specific points belong in the conversation with your agent before you sign:

The VA escape clause. VA's Buyer's Guide says it must be in the sales contract for VA-guaranteed loans. It lets you walk away without losing your earnest money if the price is higher than VA's appraised value. You can still choose to go ahead. VA notes you get the earnest money back, but not money you've already spent on an inspection or appraisal.

Seller concessions. VA's closing costs page says the buyer and seller can negotiate who pays closing costs, and VA doesn't limit credits toward normal closing costs. Seller concessions, such as paying your funding fee, paying off your debts, or prepaying your insurance, are capped at 4% of the home's reasonable value from the VA Notice of Value.

Also ask about a home inspection contingency and a financing deadline.

Step 8: Get a home inspection (the appraisal isn't one)

VA is blunt about this in its Buyer's Guide: a VA appraisal is not a home inspection. Inspections aren't required, but VA highly recommends one. Hire a state-licensed inspector who isn't tied to anyone in the sale. If the report turns up problems, that's leverage: you can ask for repairs, a lower price, or credits.

Step 9: The VA appraisal and Notice of Value

After you sign the contract, your lender orders the VA appraisal from a VA fee-panel appraiser. You get a Notice of Value (NOV) with the estimated value, comparable sales, photos, and any repairs needed to meet VA's minimum property requirements.

If the value comes in below the price, VA's Buyer's Guide lists your options:

1. Ask for a Reconsideration of Value (ROV), with your lender or agent submitting better comparable sales
2. Renegotiate the price with the seller
3. Pay the difference in cash at closing
4. Use the escape clause and walk away

Step 10: Closing and moving in

Before closing:

• The CFPB says lenders must give you the Closing Disclosure three business days before your scheduled closing. Compare it line by line with your Loan Estimate and ask about every change.
• Bind homeowner's insurance (required for all mortgages).
• Verify wiring instructions by phone, using a number you already know. The CFPB warns that scammers impersonate closing agents by email.
• Do a final walkthrough.

Occupancy timing: VA's lender training material says a "reasonable time" to move in generally means within 60 days after closing. A specific future event, such as retirement on a set date, can justify a later date of no more than 12 months after closing. If deployment or a move date complicates this, raise it with your lender early.

Common mistakes

1. Waiting to request the COE. It's quick online or through your lender. Get it early so eligibility and funding fee exemption aren't last-minute surprises.
2. Assuming full entitlement means unlimited approval. The lender still decides what you can afford.
3. Skipping the inspection because "VA already appraised it." The appraisal is about value and minimum property standards, not a full condition report.
4. Shopping only one lender. Rates, points, and fees vary, and VA itself says to compare.
5. Forgetting cash to close. Only the funding fee can be financed on a purchase. Budget for earnest money, inspection, appraisal, closing costs, and prepaids unless the seller covers them.
6. Not mentioning a pending VA disability claim. It can affect funding fee exemption or a refund. Ask your lender.

Related guides

• How to file a VA disability claim step by step
• How VA combined disability ratings work
• Illinois veteran property tax exemptions and state benefits
• Bare-bones budget for a tight income

Sources

• VA: VA-backed Veterans home loans
• VA: Purchase loan (last updated Jan 7, 2026 at time of writing)
• VA: Eligibility for VA home loan programs (updated Sep 22, 2026)
• VA: How to request a VA home loan COE (updated Sep 22, 2026)
• VA: VA funding fee and loan closing costs (updated Oct 5, 2026)
• VA: VA home loan entitlement and limits
• VA: VA Home Loan Guaranty Buyer's Guide (PDF)
• VA Loan Guaranty: VA loan requirements, lender training handout (PDF)
• CFPB: Loan Estimate explainer and Closing Disclosure explainer
• CFPB: Mortgage closing scams: how to protect yourself and your closing funds

Guide published November 2026. VA fees and rules change. Confirm current details on VA.gov and with your lender before you rely on them.