Buying your first home is a once-in-a-lifetime investment, and VA loans make it possible for eligible veterans who have served our country, active military, and their surviving spouses. VA mortgages are popular because of the many perks they offer, including competitive interest rates and no down payments. If you’re still in the service, you don’t need to worry. But if you have your own business, or have been unemployed, it’s good for you to be informed of the VA loan employment requirements.
Before You Apply
Remember you must meet eligibility requirements for a VA mortgage. Applicants must meet the following criteria regardless of employment status:
- For active-duty members: You must have served for at least 90 consecutive days.
- For veterans or members who were active-duty in wartime: you must have served for at least 90 consecutive days.
- For veterans or members who were active-duty in peacetime: you must have served for at least 181 consecutive days.
- For National Guard and members of the Reserve: you must have served for at least six years.
- For spouses: You are married to a veteran who has a service-related disability, died in service, or is missing in action or a prisoner of war.
*For more detailed information on eligibility please visit the VA website.
A Certificate of Eligibilty (COE) from the VA can be obtained by your lender. Keep in mind eligibility does not automatically mean you will qualify for a VA loan – just that you can apply for one. Before your approval, a lender will look at your income, credit history, recent employment history, and credit (FICO) score.
What are the VA loan Employment Requirements for Self-Employed Borrowers?
Many veterans opt for contract work and/or entrepreneurship after they have concluded their service. So long as they qualify, these vets are eligible to get a VA Home Loan – they will just be required to meet different criteria.
In this case, “self-employment” refers, but is not limited, to:
- Freelancing
- Contract work
- Sole business ownership
- Business partnership (if you own 25% or more of any business)
When you apply for a VA loan, you will usually have to provide your lender with documents showing the last two years of your income. Your lender will use these to validate your business’s financial strength and the stability of your income. Your lender may request the following, depending on how you file your taxes each year:
- Bank statements
- Balance sheets
- Tax returns for you and/or your business
Can You Access a VA Home Loan While Unemployed?
Even if you do not have a job, you are not excluded from accessing a VA home loan. While you can’t use unemployment assistance to qualify for a VA mortgage, you should be able to build or buy your dream home if you have other qualified income to demonstrate to the lender.
Alimony or child support is one example of income you can use to qualify for a VA loan while unemployed. You may also use other forms of assistance, including disability income from the VA. You cannot qualify for a VA home loan with lottery winnings, or by using income from a co-signer.
Everyone has unique financial situations. With an experienced VA lender like The Federal Savings Bank, you can trust that you’re seeing all the best options that are available to you as someone who served our country.
Please contact us at +1 877-788-3520 for a free consultation with one of our expert VA loan officers. Or explore our resources for new home buyers for more on VA home loans, as well as conventional, FHA options, and more.
Subject to credit approval. Terms and conditions may apply. Property insurance is required for all loans secured by property. *For more detailed information on eligibility please visit the VA website.