VA LOAN CAPTAIN BLOG & Learning Center

VA Mortgage Rules for Civilian Employment

By: Grant Moon 07/10/14 03:12 pm

The VA guidelines for employment allow for both a bit of flexibility on behalf of the VA lender as well as hard and fast rules. From credit to asset verification to income, lenders must follow the prescribed rules and document those rules have been followed and include that documentation in the file. As it relates to income and employment, VA lenders are required to make sure the veteran’s employment status is in line with what the VA requires.

If you’re active duty and a career soldier, you’ve established your employment. As long as your current income is expected to continue for at least three years, your employment status meets the guidelines. But when you step into civilian life, there are some things that the VA lender requires.

If you’re newly discharged the VA asks that you either be in a similar line of work compared to your service in the military or have at least two years on the same job. There is no clear cut guideline but a lender’s interpretation. For instance, if you were a specialist in the Army and worked in IT and you got a similar job in the technology industry, then the two year requirement can be waived in the very same manner a recent college graduate can have the two year rule waived by providing a college transcript.

However, if you’ve been in the civilian work force for a few years, VA lenders ask that you be employed full time in addition to the two year requirement. Part time income can be used only if you can show a two year history of part time work along with a reasonable expectation the part time work will continue. If you’re self-employed, you will need to provide two years income tax returns showing consistent self-employment income along with providing an expectation that similar income will continue for at least three years.


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