Updates to the VA Loan Eligibility Requirements for National Guard Servicemembers & Veterans
Throughout the history of the VA loan program, the goal has always been to serve the veterans and members of our military as best as possible.
Periodically, new laws are passed that change certain aspects of VA loans so that they are more accessible and available to our nation's heroes.
2020 saw three major changes to the VA loan program, and now we're excited to announce that at the beginning of 2021, another major change became law.
This new law, the Veterans Health Care and Benefits Improvement Act of 2020, includes a section that expands VA loan eligibility to a greater number of National Guard servicemembers.
What Are the New Service Eligibility Requirements?
In order to be eligible for a VA loan, a National Guard servicemember or veteran must meet the VA's minimum service requirements for "full-time National Guard Duty."
As part of the Veterans Health Care and Benefits Improvement Act, the definition of what constitutes full-time National Guard duty for VA loan eligibility purposes has now been updated to:
- 90 days of cumulative active duty service, and
- 30 days of consecutive active duty service
Compared to the previous requirements for members of the National Guard, these new minimum service requirements are considerably shorter, and they don't just apply to those who are currently serving.
The law included a provision that makes it retroactive, meaning any National Guard member can qualify, regardless of when they served, as long as they met these requirements at any point during their career.
How the Days Are Calculated
Now, when looking at these dates, we want to make it clear that the 30 days isn't in addition to the 90. Instead, it's that at least 30 of those 90 days need to be consecutive.
That being said, it is possible that you will need to serve more than 90 days before you can qualify. If you've served a total of 365 days, for example, but your longest orders ended up lasting only 29 days, then you won't be able to qualify until you receive orders that last for at least 30 consecutive days.
Another factor to consider when looking at your service is that not all types of orders will count towards the requirement.
Service Orders That Count Towards Your Eligibility
One other amazing change that came out of the Veterans Health Care and Benefits Improvement Act is that now both Title 10 and certain Title 32 orders can count towards these minimum service periods.
However, it's important to note that not all Title 32 service qualifies. In order to count towards either requirement, your orders must fall under one of the following sections of Title 32:
- Section 316, "Detail of members of Army National Guard for rifle instruction of civilians"
- Section 502, "Required drills and field exercises"
- Section 503, "Participation in field exercises"
- Section 504, "National Guard schools and small arms competitions"
- Section 505, "Army and Air Force schools and field exercises"
This change is important because, under the previous service eligibility requirements, only Title 10 orders were accepted. So not only was the service requirement longer, it was also more restrictive regarding what types of service could even qualify.
What Were the Previous Eligibility Requirements?
Before the Veterans Health Care and Benefits Improvement Act, National Guard servicemembers could only be eligible for a VA loan if they served:
- 90 days of Title 10 active duty service during the Gulf War (8/2/90–present), or
- 6 years of service if they weren't activated during the Gulf War or they served in any other period
In addition, National Guard servicemembers qualifying under the 6-year requirement would ALSO have to meet at least one of the following extra requirements:
- Have an honorable discharge
- Be placed on the retired list
- Continue to serve in the Selected Reserve, or
- Get transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable
Can you see how much longer it could take a National Guard servicemember to achieve qualifying service under these old rules? Just think about the difference between 90 days and 6 years, especially for older National Guard veterans who served before the Gulf War.
What The New Law Means for National Guard Servicemembers
As we've already mentioned, the new law makes it easier for more National Guard servicemembers to qualify for VA home benefits in much less time.
By shortening the total number of days needed to qualify—and expanding the definition of qualified service to include Title 32 orders—thousands of National Guard servicemembers and veterans can now take advantage of the VA home loan benefit, regardless of when they served or whether or not they were deployed overseas.
This is especially impactful for National Guard veterans who served prior to the Gulf War. Because the law applies retroactively, any National Guard servicemember who met the new requirements at any time during their military career can now receive a VA home loan.
In addition, Title 10 orders are usually less common than Title 32 orders. Because of this fact, members of the National Guard now have more overall opportunity to accrue the now-shorter requirement.
And because those 90 days are cumulative, shorter periods of service—including annual training orders (but not monthly drills)—can be counted towards the requirement.
Since discharge papers aren't usually issued for these shorter periods, retirement statements and copies of applicable military orders can be used for documentation.
Examples of Qualifying Service
In order to demonstrate how much easier it is for National Guard servicemembers to qualify for a VA loan under the new service requirements, we wanted to share a recent example.
In 2020, many members of the National Guard received Title 32 orders under section 502(f) as part of the response to the coronavirus pandemic. Because section 502 is one of the allowed sections for eligibility under Title 32, any time spent fulfilling these orders will count towards the 90-day requirement.
For many guard members, these orders had them serve at least 89 days. Under the new law, this would cover the 30 consecutive day requirement; in order to meet the other portion, they would have needed to serve just one day of annual training sometime during their career.
So, in 2020 alone, thousands of National Guard members have now met the minimum service requirements in order to be eligible for a VA loan.
Why Did You Wait Until Now to Announce This Change?
Even though the law was signed by President Trump on January 5th, 2021, we had to wait for guidance from the VA on how to implement it.
They finally released this guidance on April 15, 2020, as Circular 26-19-33.
Now that we can officially implement these changes, we're so excited to serve a greater number of veterans.
For those who are or have ever been a member of the National Guard, we know how much our nation asks of you. By reducing the benefits gap between you and active duty servicemembers, your home loan benefits are now a better reflection of your service and sacrifice.
Take Advantage of Your VA Home Loan Benefits
With the release of this circular, we are so excited to finally announce that all National Guard servicemembers who meet the new service requirements are now eligible to apply for a VA loan with our team at Low VA Rates.
While we can't guarantee that you'll actually receive a VA loan (as that still depends on your financial qualifications), we love that you no longer have to be held back by how long you did—or didn't—serve.
Whether you are serving now or you served 40 years ago, we can't wait to help you! To talk about getting your VA home loan, go ahead and give us a call at (866) 569-8272.