Summary: Washington State has a sizable military population who can take advantage of VA home loans. But in order to qualify, buyers must have sufficient income, suitable credit, and a valid Certificate of Eligibility. Here we review all of them.
Washington State has a sizable military population, with nearly 70,000 military personnel and another 90,000 dependents and nearly 20,000 reservists. Many of them reside in the state for years at a time. As a result, there are a lot of home buyers in the state who could benefit from using a VA loan to buy a house.
This unique program offers many benefits for eligible borrowers, including 100% financing. This article explains the basic eligibility requirements for Washington State VA loans.
Home buyers: Please contact us if you have questions about VA loan eligibility requirements, or to receive a no-obligation rate quote.
Eligibility Requirements for Washington State VA Loans
Home buyers who wish to use a VA loan in Seattle must have sufficient income, suitable credit, and a valid Certificate of Eligibility. These are the minimum eligibility requirements for VA home loans in Washington State.
There are property-related requirements as well. The home you are buying must be used for personal occupancy. It must be your primary residence. Generally speaking, VA loans cannot be used to purchase vacation properties or second homes. When using this program, you are expected to reside in the house being purchased.
Washington State VA loans can be used to:
- Purchase a home.
- Purchase a condo unit that’s part of a VA-approved project.
- Build a new home.
- Buy and improve a property simultaneously.
- Improve an existing property by adding energy-related features.
- Buy a manufactured home and/or lot.
Obtaining Your Certificate of Eligibility
The Certificate of Eligibility, or COE, is a key requirement for Washington State VA loans. This official government document tells mortgage lenders that you are, in fact, eligible for a VA-guaranteed home loan. Military service members can request this document online through the Department of Veterans Affairs website.
Most military members and veterans in Washington State are eligible for the VA loan program, and can therefore obtain a Certificate of Eligibility.
This program is available to the following groups:
- Active duty military who have served for at least 90 days continuously.
- Veterans who have served for at least 90 consecutive days during wartime or 181 days during peacetime.
- National Guard and Selected Reserve with at least six years of service. (Exception: Those who served in the Gulf War may be eligible with at least 90 days of service.)
- Military spouses are eligible for Washington State VA loans in some cases. According to official guidelines, this applies to the “Unremarried spouse of a Veteran who died while in service or from a service connected disability, or spouse of a Servicemember missing in action or a prisoner of war.”
Other Eligible Groups
In addition to the military service members and veterans listed above, there are other groups that might be eligible for a VA loan in Washington State.
This includes the following:
- Certain U.S. citizens who served in the armed forces of a government allied with the U.S. during World War II.
- Individuals who have served with certain organizations such as: Public Health Service officers; cadets at the United States Military, Air Force, or Coast Guard Academy; midshipmen at the United States Naval Academy; officers of National Oceanic & Atmospheric Administration; merchant seaman with World War II service; and others.
Residual Income Requirements
VA loans do not require a certain income level or threshold. But borrowers who apply for this program are expected to have sufficient income to repay their loan obligation. When you apply for a VA loan in Washington State, the lender will examine your current income and debt situation to ensure you have the ability to cover your monthly expenses going forward.
There’s also a “residual income” requirement with VA loans. In short, the Department of Veterans Affairs requires borrowers to have a certain amount of money left over each month, after all major debt obligations (including the mortgage payment) have been paid. This is referred to as residual income.
The idea is that homeowners should be able to cover their monthly housing costs and still have money for basic necessities like food and transportation. It’s a sensible financial safeguard designed to protect veterans and military members who use VA loans to buy a home. Residual income requirements vary based on location and family size.
VA Loan Limits for Washington State: Eliminated In 2020
In addition to the eligibility requirements listed above, there used to be loan limits that veterans needed to stay under in order to be able to avoid making a down payment. Technically speaking, the VA does not set a cap on the amount you can borrow. But they did limit the size of loans they were willing to guarantee, and this can directly affect the amount you are able to borrow.
But as per a new rule that was recently passed – the Blue Water Navy Vietnam Veterans Act of 2019 – VA loan limits have been eliminated. That means eligible veteran applicants can buy a more expensive home and therefore take out a higher loan amount to pay for it without risk of losing the ability to avoid a down payment.
In order to take advantage of this perk, veteran applicants must not already have more than one VA loan or have defaulted in the past on a VA loan they took out.
Further, lenders will use their own discretion when assessing loan applications and may still have their own requirements when it comes to the maximum loan amount that they will allow for different borrowers.
Want to Apply for the Program?
Do you have questions about Washington State VA loan eligibility requirements, or other aspects of this program? Want to get pre-approved for a home loan, or request a mortgage rate quote? We can help. Sammamish Mortgage is a local, family-owned company based in Bellevue, Washington that has been providing borrowers with mortgage programs for over 25 years. We serve the entire state, as well as the broader Pacific Northwest region. Please contact us if you have mortgage-related questions.