VA Loan Requirements 2026: NEW Partial Claim Program + $806K Limits

The Federal Housing Finance Agency (FHFA) announced major VA loan changes for 2026. If you're a veteran or active-duty service member, these updates could save you $100,000+ over 30 years.

🔥 Key Changes for 2026

1. NEW VA Partial Claim Program

Congress enacted the VA Home Loan Reform Act, creating a permanent partial claim program to help veterans avoid foreclosure.

How It Works:

→ Miss payments due to hardship? VA advances funds to cure them
→ VA attaches subordinate lien (second mortgage) instead of foreclosure
→ You repay when you sell/refinance (no immediate payment)
→ Keeps you in your home, protects credit score

Example: Marine veteran John missed 3 payments ($6,000) after medical emergency. VA advances $6,000, attaches lien, John keeps his home. He repays when he sells in 5 years.

⚠️ Program details being finalized. Check with VA-approved lenders for latest updates.

2. Higher 2026 Loan Limits

FHFA raised baseline limit to $806,500 (up $39,950 from 2025's $766,550).

Year	Baseline	High-Cost	Change
2025	$766,550	$1,149,825	-
2026	$806,500	$1,209,750	+$39,950

What This Means: Veterans with full entitlement can buy homes up to $806,500 with ZERO down in standard counties. High-cost areas (SF, LA, NYC): up to $1,209,750!

💡 Pro Tip:

Full entitlement = NO VA loan limit. Your max is determined by lender underwriting, income, credit, and appraisal—not federal caps. Get pre-approved to see your buying power.

3. Full vs Partial Entitlement

✅ Full Entitlement

• Never used VA loan
• Paid off previous VA loan
• Restored after foreclosure
• NO loan limit
• 0% down any price

⚠️ Partial Entitlement

• Currently have VA loan
• Used but didn't restore
• Buying second home
• Limited to remaining
• May need down payment

📊 2026 Entitlement Calculation:

Basic: $36,000

Bonus: 25% of $806,500 = $201,625

Total: $237,625

Max loan with 0% down: $950,500 (4× entitlement)

✅ Core Requirements (Unchanged)

1. Eligibility

✓ Active Duty: 90 days (wartime) or 181 days (peacetime)
✓ Veterans: Honorable discharge, minimum service met
✓ Guard/Reserves: 6 years or 90 days active (wartime)
✓ Surviving Spouses: Unmarried spouse of KIA/service-connected death

2. Credit Score

VA has no minimum, but lenders typically require:

→ 620+: Standard requirement
→ 580-619: Manual underwriting possible
→ Below 580: Very difficult

Veterans with service-connected disabilities may qualify with lower scores.

3. Income & DTI

→ DTI: 41% or lower preferred
→ Residual Income: VA minimum varies by region/family size
→ Employment: 2 years consistent history

Region	Family of 2	Family of 4
Northeast	$755	$1,025
Midwest	$738	$1,003
South	$738	$1,003
West	$823	$1,117

4. Property Requirements

✓ Eligible: 1-4 unit homes, townhouses, VA-approved condos
✓ Owner-Occupied: Must be primary residence
✓ Move-In Ready: Safe, sanitary, structurally sound
✗ NOT Eligible: Investment properties, vacant land, major fixer-uppers

5. VA Funding Fee

Loan Type	First Use	Subsequent
Purchase (0% down)	2.15%	3.30%
Purchase (5%+ down)	1.25%	1.25%
Refinance (IRRRL)	0.50%	0.50%
Cash-Out Refi	2.15%	3.30%

💰 Example:

$400K home (first use, 0% down): $400K × 2.15% = $8,600 fee

Good News: Roll into loan (no upfront payment)

Exemption: 10%+ service-connected disability = $0 fee

📋 How to Apply (7 Steps)

Get Certificate of Eligibility (COE)

Online at eBenefits.va.gov (instant) or through your lender

Check Credit Score

Aim for 620+. Get free report at AnnualCreditReport.com

Find VA-Approved Lender

Compare lenders for best rates (even 0.25% = $20K savings)

Get Pre-Approved

Lender verifies income, credit, assets. Need: COE, tax returns, pay stubs, bank statements, DD-214

Find Home & Make Offer

Work with VA-experienced agent. Property must meet VA MPRs

Complete Underwriting

VA appraisal ordered, financial verification. Takes 2-4 weeks

Close on Your Home!

Sign papers, pay closing costs (1-3% of loan), get keys!

🎉 Ready to Start?

Get pre-approved in 24 hours and lock 2026 rates!

Get Pre-Approved Now →

❓ Common Questions

Can I use VA loan multiple times?

Yes! Once you pay off and sell, entitlement restores. You can even have 2 VA loans simultaneously with enough remaining entitlement.

What credit score needed for VA loan 2026?

Most lenders require 620+. Some approve 580+ with compensating factors. Veterans with service-connected disabilities may qualify lower.

Can I buy fixer-upper with VA loan?

Property must meet VA MPRs. Options: VA Renovation Loan (up to $50K repairs) or negotiate seller repairs before closing.

How does partial claim program work?

If you miss payments due to hardship, VA advances funds to cure them, attaches subordinate lien. You repay when you sell/refinance. Prevents foreclosure, protects credit.

Can I buy multi-family with VA loan?

Yes! 2-4 units if you live in one. 2026 limits: 2-unit $1,032,975, 3-unit $1,248,575, 4-unit $1,551,050. Zero down with full entitlement!

Are VA rates lower than conventional?

Usually yes! Jan 2026: VA 6.16% vs Conventional 6.62% = 0.46% lower. On $400K loan = $57,600 saved over 30 years. Plus no PMI saves $200-400/month!

🎯 Key Takeaways

✅ What's NEW 2026

→ Partial claim program (prevents foreclosure)
→ $806,500 baseline (+$39,950)
→ Full entitlement = no limit

🔒 Stays Same

→ Zero down payment
→ No PMI (save $200-400/mo)
→ Lower rates (0.25-0.50% below conventional)

💰 Savings

→ $80K saved (no down on $400K)
→ $300/mo saved (no PMI)
→ $57K saved (lower rate 30yr)

⚡ Action Steps

→ Get COE at eBenefits.va.gov
→ Check credit (aim 620+)
→ Compare lenders

💪 Bottom Line

2026 VA loan changes are HUGE for veterans. New partial claim program prevents foreclosure, higher limits mean more buying power, and you still get zero down + no PMI. If you're eligible, VA loans are the best mortgage deal in America.

Get Started Today →

VA Loan Requirements 2026: NEW Changes & Partial Claim Program

🎯 What Changed for VA Loans in 2026?