What does VA loan eligibility require?

VA loan eligibility primarily requires no money down and the possession of a certificate of eligibility, which is a document issued by the Department of Veterans Affairs (VA). The VA loan program is designed to assist veterans, active-duty service members, and certain members of the National Guard and Reserves in obtaining home financing without the burden of a down payment. This makes homeownership more accessible for those who have served in the military.

The certificate of eligibility verifies to lenders that the borrower is eligible for a VA loan based on their service history, allowing them to take advantage of favorable loan terms, such as competitive interest rates and no private mortgage insurance (PMI) requirement.

While other factors like credit scores can influence the approval process, there is no strict minimum credit score requirement set by the VA. Additionally, while fixed-rate mortgages are common, the VA does offer various loan options, including adjustable-rate mortgages. Therefore, principal requirements revolve primarily around the no down payment stipulation and the certificate of eligibility, which is why this option is the correct answer.