What Is a VA Entitlement Code? | Guide to VA Entitlement 2024

February 13, 2024 - 9 min read

Introduction to VA entitlement

VA entitlement is the amount the Department of Veterans Affairs (VA) guarantees when you apply for a VA loan. To put it simply, it’s how much the VA will repay your mortgage lender in the event that you stop making your loan payments (usually up to 25% of the total loan amount).

The basic entitlement starts at $36,000, but getting a bonus entitlement opens the door to buying a more expensive home.

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Understanding VA entitlement codes

VA entitlement codes are 11 alphanumeric designations given to veterans, with each one representing different situations related to service duration. These codes streamline access to benefits.

However, there are some common misconceptions about entitlement and codes.

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For example, some people confuse entitlement with loan limits. Entitlement refers to what the government guarantees a lender in the event of borrower default, while loan limits refer to maximum an applicant can borrow (based on where they live).

Some borrowers also believe that once they use their entitlement, they can’t get another VA mortgage. However, they can use their entitlement multiple times, and even restore it after paying off a previous VA loan.

There’s also the $36,000 myth, with some believing this is the maximum for VA entitlement. But this amount only serves as a baseline, not a ceiling.

While the VA typically guarantees up to 25% of the mortgage loan, the $36,000 represents the lowest amount guaranteed. So even if your mortgage loan exceeds $144,000 (25% of $144,000 equals $36,000), you can still get a larger loan.

Be mindful, too, that the type of entitlement code doesn’t affect one’s ability to get a VA loan. In fact, the specific code doesn’t matter at all. As long as you have a code and meet minimum service requirements, you’re eligible for a VA-backed loan.

The VA entitlement system can be complex, even for eligible veterans. However, there are ways to simplify the application process and obtain proper VA home loan eligibility for your new home.

Firstly, make sure you maintain the statement of service records for your service history, including discharge papers. This detailed information is necessary to determine whether qualifying for a VA loan program is possible.

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Also, take advantage of online resources. The VA’s official website has information on entitlement codes and VA eligibility requirements.

You can also get personalized assistance through local VA offices or veteran service organizations, where experts can guide you through the system. They can help you calculate your entitlement and understand the meaning behind your code.

Common entitlement codes

Several VA entitlement codes exist, each representing different details of a veteran’s eligibility and benefits. Here are examples of four common codes:

  • Code 5: Indicates that you’ve used a VA home loan before, and you’re eligible to use this benefit again.
  • Code 9: This code is given to peacetime veterans who served after the Vietnam War, but before the Persian Gulf War (at least 181 days between 5/8/1975 and 9/7/1980).
  • Code 10: These are veterans who served in the Persian Gulf War.
  • Code 11: Reserved for veterans and certain reservists.
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How to get your Certificate of Eligibility

Here’s how to obtain a Certificate of Eligibility (COE) for a VA loan:

  • Online application: The quickest method is applying online through the VA’s eBenefits portal. You can check your VA home loan benefit eligibility and submit your application conveniently.
  • Through a lender: You can also request a COE through a VA-approved lender. Many lenders can obtain a certificate on your behalf during the loan process.
  • By mail: Complete VA Form 26-1880 and mail it to your regional loan center. The form is available on the VA’s official website.
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How basic vs. bonus entitlement works

Basic entitlement for a VA loan is like a guarantee from the government that they’ll cover a chunk of the loan amount.

Again, the $36,000 you might hear about is the minimum guarantee—think of it as the starting point.

Since the VA usually guarantees up to 25% of the loan, the VA commits to covering up to $50,000 on a $200,000 loan.

Now, let’s say you want a bigger loan than what basic entitlement covers. This is where your bonus entitlement comes into play. It’s like an additional guarantee, allowing you to go beyond the basic limit and qualify for a larger loan without needing a hefty down payment.

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The bottom line: VA entitlement code

Understanding entitlement and codes can help you access a full range of benefits and secure the financing needed for your home. To learn more about using a VA home loan, speak with a VA-approved loan expert.

It’s your service, your benefits – let them help you make the most of them.

VA Entitlement Code FAQ

What are VA entitlement codes?

VA entitlement codes are alphanumeric numbers given to veterans. These numbers indicate details about their service, including what they’re eligible for and the benefits they can receive. These codes are important because they determine how much support they can get from the VA.

How many VA entitlement codes are there?

VA entitlement codes vary and describe different things about a veteran’s situation, making it easier to understand and manage their benefits. For example, these codes can indicate the era a veteran served, whether a borrower is a surviving spouse, and whether they’ve used VA benefits before. Common entitlement codes include 5, 9, 10, and 11.

How do I find out my VA entitlement code?

Veterans can find their VA entitlement code on their Certificate of Eligibility (COE), which is a document stating that they’ve met the requirements for a VA loan, or by checking with the Department of Veterans Affairs. For additional assistance, you can also check with your local VA offices or veteran service organizations to understand your entitlement status.

What is the significance of VA entitlement codes for VA loans?

VA entitlement codes are significant for VA loans because they determine the type and amount of benefits you’re eligible to receive. Getting approved for a hoe loan, however, has little to do with the exact code. The important thing is that you have one. Lack of an entitlement code means that the VA will not guarantee your loan, in which case you can’t qualify for a VA home loan.

Can I use my VA entitlement code more than once?

Yes, in certain circumstances, veterans and service members can reuse their VA entitlement code for subsequent VA-backed home loans, such as when they sell their previous home or choose to refinance their current VA loan.

Do I need a specific VA entitlement code to apply for a VA Interest Rate Reduction Refinance Loan (IRRRL)?

No, a specific VA entitlement code is not required to apply for an IRRRL, as it is a simplified refinance option for current VA loan holders. However, veterans and service members will need to meet other eligibility criteria for an IRRRL.

Can my VA entitlement code be transferred to another person?

No, VA entitlement codes are non-transferrable and can only be used by the eligible veteran or service member. However, certain situations may allow for a surviving spouse to utilize the VA home loan benefit.

How long does it take to receive a VA entitlement code?

The timeframe to receive a VA entitlement code may vary. It can take several weeks to process a COE application through the VA. Working with an approved VA lender can help streamline the process.

Can I use my VA entitlement code for a non-primary residence?

In most cases, VA entitlement codes are intended for primary residences. However, there are specific scenarios where a veteran or service member may be eligible to use their VA benefit for multi-unit properties or certain types of vacation homes.

Can I use my VA entitlement code for a construction loan?

Yes, veterans and service members can utilize their VA entitlement code for a VA construction loan, which provides financing for building a new home. However, certain requirements and additional documentation may apply.

Valencia Higuera
Authored By: Valencia Higuera
The Mortgage Reports contributor
Valencia Higuera is a freelance writer from Chesapeake, Virginia. As a personal finance and health junkie, she enjoys all things related to budgeting, saving money, fitness, and healthy living.
Aleksandra Kadzielawski
Reviewed By: Aleksandra Kadzielawski
The Mortgage Reports Editor
Aleksandra is the Senior Editor at The Mortgage Reports, where she brings 10 years of experience in mortgage and real estate to help consumers discover the right path to homeownership. Aleksandra received a bachelor’s degree from DePaul University. She is also a licensed real estate agent and a member of the National Association of Realtors (NAR).