The Bottom Line Up Front

VA loans are among the more accessible mortgages for eligible borrowers. Lenders denied 16.1% of VA applications in 2025, lower than FHA’s 22.0%. The VA sets no minimum credit score, uses a 41% debt-to-income benchmark that residual income can offset, and requires no down payment for the typical buyer. Approvals stall on lender overlays, thin residual income, recent credit events, and properties that fail the VA appraisal.

The difficulty depends on where you stand on four checks: service eligibility, credit, income, and the property. Service eligibility is a yes or no answer on your Certificate of Eligibility. The other three are lender judgments within VA guidelines, which is why the same borrower can get a no from one lender and a yes from another. Knowing which check is your weak spot tells you what to fix before you apply.

How Hard Is It, by the Numbers

Federal Home Mortgage Disclosure Act data gives the clearest picture. In 2025, lenders turned down 16.1% of applications for VA mortgages, according to Inside Mortgage Finance’s analysis of the HMDA filings. FHA applications were denied at 22.0%. Denial rates across mortgage products declined overall from 2024 to 2025, though FHA and USDA purchase denials ticked up.

Those numbers measure formal denials, not every application that stalls. Files withdrawn by the borrower or closed for incompleteness are not counted as denials, so the rates understate the share of buyers who do not reach closing. Still, the gap with FHA matters: FHA is the program best known for flexible credit, and VA applications had the lower denial rate in the same year.

Part of the explanation is who applies. VA borrowers must first clear a service requirement, and a large share arrive with steady Military or post-service income. The program’s structure helps too. With no down payment for the typical buyer and no monthly mortgage insurance, the monthly payment on a VA loan is lower than on an otherwise similar FHA loan, which makes the debt-to-income math easier to pass.

Check 1: Service Eligibility and Your Certificate of Eligibility

The first gate is service. Active service members meet the minimum after at least 90 continuous days. Veterans who served from August 2, 1990, to the present qualify with 24 continuous months, the full period of at least 90 days for which they were called to active duty, or less if they were discharged for a service-connected disability. Earlier service periods carry their own minimums of 90 or 181 days.

National Guard and Reserve members have two paths. Six creditable years of service qualifies, whether you are still serving or were discharged honorably or placed on the retired list. So does at least 90 days of qualifying non-training active-duty service. Surviving spouses who are eligible for certain Dependency and Indemnity Compensation can also qualify.

If you fall short, the VA reviews discharges under qualifying exceptions, including hardship, early outs, reductions in force, certain medical conditions, and service-connected disability. Veterans with an other than honorable, bad conduct, or dishonorable discharge can apply for a discharge upgrade or a Character of Discharge review. Your lender can pull your COE online in minutes; see VA loan pre-approval for how that fits the timeline.

Check 2: Credit History and Lender Overlays

The VA does not set a minimum credit score. Lenders do, and their floors vary. That difference is the single biggest reason one lender approves a VA file another lender declines. If you are near a lender’s cutoff, ask what its floor is and compare it with others before assuming you do not qualify. See minimum credit score for a VA loan and VA lender overlays explained for how those floors work.

Underwriters look past the score at your payment history. Recent late payments, collections, and judgments get questions. Major events come with waiting periods. Under VA guidance, a Chapter 7 bankruptcy discharged more than two years ago can be disregarded, and one discharged between one and two years ago can still be acceptable with reestablished credit and a documented cause outside your control. A borrower in Chapter 13 can qualify after 12 months of satisfactory plan payments with trustee or court approval. Details are in VA loans after bankruptcy.

Check 3: Debt-to-Income Ratio and Residual Income

VA underwriting uses two income tests together. The first is the debt-to-income ratio, with 41% as the benchmark. A ratio above 41% calls for closer review and compensating factors, but it is not an automatic denial. Under 38 CFR 36.4340, if your ratio exceeds 41% and your residual income exceeds the VA guideline by at least 20%, the second-level review and statement of justification are not required.

The second test is residual income: the money left each month after the mortgage payment, taxes, debts, and estimated living costs. VA tables set the required amount by family size, loan amount, and region of the country. Residual income is the reason a VA borrower with a higher ratio can still be approved. A borrower with a modest ratio but thin residual income can be the harder file. See DTI over 41% on a VA loan for worked examples.

Check 4: The Property and the VA Appraisal

Even an approved borrower can stall on the house. The home must meet VA minimum property requirements, which focus on safety, soundness, and sanitation, and the VA appraisal must support the price. Peeling paint on older homes, roof or heating problems, and missing safety items are common conditions that must be repaired before closing. See VA minimum property requirements for the full list.

If the appraisal comes in below the contract price, you can renegotiate, pay the difference in cash, or walk away under the VA’s escape clause without losing your earnest money. The home must also be your primary residence; a VA purchase loan cannot be used for a rental or a vacation property.

What Makes VA Loans Easier Than Other Options

The program’s structure removes several hurdles that sink other applications. Nearly 90% of VA-backed loans are made with no down payment, so saving a large cash deposit is not a requirement. VA purchase loans carry no monthly private mortgage insurance, which lowers the payment and improves the debt-to-income ratio. And the benefit is reusable: once you sell the home and pay off the loan, or a qualified Veteran assumes it and substitutes entitlement, you can restore your entitlement and use it again.

Those features make the VA loan easier to qualify for than its reputation suggests. The program has more paperwork than other loan types, mainly the COE and the VA appraisal, but paperwork is a process step, not a qualification barrier.

How to Improve Your Odds Before You Apply

The Bottom Line

VA loans are not hard to get for eligible borrowers. Lenders denied 16.1% of VA applications in 2025, below FHA’s 22.0%, and the program removes the down payment and mortgage insurance hurdles that stop buyers in other loan types.

Where VA files run into trouble is predictable: lender credit floors, thin residual income, recent bankruptcies or foreclosures, and homes that fail the VA appraisal. Settle your COE early, check each lender’s overlays, and fix the weakest of the four checks before you apply.