VA Loan Eligibility Rules For Reservists and the National Guard
Current VA loan rules specify minimum periods of military service to establish eligibility for the VA loan benefit.
At the time of this writing, active duty military members serving today must serve for “90 continuous days” before they can apply for a certificate of eligibility.
Gulf War veterans no longer on active duty who served from August 2 1990 to the present are required to have served two continuous years (24 months) or “the full period (at least 90 days) for which you were called or ordered to active duty”.
The rules for reservists and members of the National Guard are different. In general, six years of service in the Guard or Selected Reserve is the requirement as long as the following criteria is met:
- discharged honorably, OR
- placed on the retired list, OR
- transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable, OR
- now serving in the Selected Reserve
VA loan rules also make certain exceptions for some veterans who don’t meet minimum time-in-service eligibility requirements. According to the VA official site, “If you do not meet the minimum service requirements, you may still be eligible if you were discharged due to (1) hardship, (2) the convenience of the government, (3) reduction-in-force, (4) certain medical conditions, or (5) a service-connected disability.”
The reduction-in-force situation is about to become very relevant as military services are looking for ways to reduce the size of the force and cut costs.
In a May 2012 report titled “Army Drawdown and Restructuring: Background and Issues for Congress” the following troop reductions were described: “…two heavy brigade combat teams (HBCTs) in Europe will be eliminated out of a total of eight BCTs that will be cut from Active Army force structure. The Army has stated that it may cut more than eight BCTs. Army endstrength will go from 570,000 in 2010 to 490,000 during the Future Year Defense Plan (FYDP) period.”
Those cuts could include what the report describes as “Selective Early Retirement Boards (SERBs) and Reduction-in-Force (RIF). Voluntary tools that the Army might use include the Voluntary Retirement Incentive, the Voluntary Separation Incentive, Special Separation Bonuses, Temporary Early Retirement Authority, the Voluntary Early Release/Retirement Program, and Early Outs.”
If members of the Guard and Reserve wind up being affected by such cuts, the early outs and voluntary early release programs could factor in when it comes time to determine a member’s VA loan eligibility. Don’t assume you are NOT eligible for a VA loan in these cases until you have spoken with a loan officer or VA loan representative about applying for eligibility.
Do you have questions about VA home loans? Ask us in the comments section.
About Bruce Reichstein
Bruce Reichstein is an Expert on (VA) Military/Veteran Home Loan Guidelines for over 26 years — www.VALoans.com. He is an experienced VA Loan Mortgage Banker who is passionate about assisting US Military Veterans utilize their Veteran Eligibility to purchase a home.