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Obtain Your Certificate of Eligibility (COE)

Step 2 VA Loan Process

Step 2 In Obtaining A VA Loan

Step 2 In The 6-Steps of the VA Loan Process

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COE stands for Certificate of Eligibility. It’s a document generated by the Department of Veterans Affairs that tells your VA-approved lender if you meet certain requirements for home loan benefits based on your military service. It also contains important information that can help your loan officer calculate your entitlement (how much the VA will guarantee for you) and fees (costs associated with the loan).

If you’ve served in one of the seven uniformed services, or are a surviving spouse, you may have earned home loan benefits. Obtaining your COE will help you know for sure.

To help you obtain this important document, here are some “do’s” and “don’t’s” to consider at this second step in the VA loan process.

1. DO ASK YOUR LENDER FOR HELP

Your VA approved lender can print most COEs right away, a great way to avoid delays.

Not all COEs can be obtained this way, but many can. If your document cannot be obtained instantly, it’s still a very good idea to enlist your lender’s help in obtaining it another way.

2. DO FAMILIARIZE YOURSELF WITH THE THREE WAYS TO GET IT

Your COE is a vital part of the VA loan process. There are three ways to get your COE:

1.       VA eBenefits Portal via the Internet

2.       Atlanta Regional Loan Center by U.S. mail

3.       VA Online Portal through your VA-approved lender

And the good news is that unless you originally applied for your COE while on active duty, it never expires. If your COE was obtained while on active duty, you’ll need to get another one after discharge. Surviving spouses may only use option #2.

3. DO LEARN THE BASICS OF VA LOAN ELIGIBILITY

Here’s the bottom line: your COE shows VA eligibility for home loan benefits. To be clear, just because you’re eligible doesn’t mean you qualify. Once you prove VA eligibility to a lender, then they will still need to determine if you qualify for a VA home loan.

Your eligibility is based on the Department of Veterans Affairs’ service guidelines. You may be eligible if you’ve served:

·         2 years on Active Duty

·         6 years in the Reserve/National Guard

·         90 days of Wartime Duty (called up Under U.S.C. Title 10)

·         181 Days of Peacetime Duty (called up under U.S.C. Title 10)

(Complete eligibility requirements can be found at www.va.gov).

Eligibility is also extended to certain veterans discharged honorably from active duty for service-connected injuries or other reasons outlined by the VA. Additionally, many surviving spouses may also be eligible. Eligibility requirements have recently been extended to include more surviving spouses. If you weren’t eligible in the past, your status may have changed due to new extended rules.

4. DON’T TRY TO MAKE SENSE OF YOUR COE WITHOUT HELP

Your COE contains alphanumeric codes and other information that your licensed VA loan officer is trained to decipher. Trying to interpret your COE on your own may cause you to misinterpret your loan entitlement. A common mistake is seeing a zero on the form and thinking there’s no entitlement available.

Just because your COE says $0 basic entitlement doesn’t automatically mean you have no entitlement; your situation may need referral to an option called Tier Two Entitlement. Tier Two enables qualified borrowers to tap into additional entitlement to purchase a home over a certain dollar amount.

It makes good sense to take advantage of the expertise of a Regional VA Loan Center representative or an experienced VA loan professional, as entitlement calculations can be confusing.

5. DON’T FORGET PROOF OF SERVICE

Proof of service should accompany your COE application:

·         Dig out your DD Form 214 when you were discharged, or

·         If you’re still serving regular active duty, you’ll need an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters. It must show your date of entry and period ordered for current active duty and how much, if any, time lost.

No single form like the DD 214 exists for Reserves or National Guard. Reservists and National Guard members need copies of adequate documentation of at least 6 years of honorable service. For Army or Air Force National Guard, you may submit NGB Form 22, Report of Separation and Record of Service, or NGB Form 23, Retirement Points Accounting.

If you were discharged from the Selected Reserve, you may submit a copy of your latest annual points statement and evidence of honorable service. Reservists and Guard members still serving must have an original statement of service showing length of service like the one used by those still serving regular active duty.

6. DON’T USE THE WRONG FORM

Use VA Form 26-1880 for:

·         Veterans

·         Active Duty

·         Reservists

·         National Guard

Use VA Form 26-1817 for:

·         Surviving spouses

Your VA-approved lender can help make sense of all the forms you need to complete the VA loan process.

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