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What are Loan Guaranty and Education Benefits for Veterans?

The loan guaranty program is generally known to the public as a VA home loan or VA mortgage loan. Education benefits for veterans are perhaps one of the most valuable benefits that members of the full-time military or reserve members are entitled to.

Loan Guaranty Program

VA helps service members, veterans, and eligible surviving spouses become homeowners. As part of our mission to serve you, we provide a home loan Guaranty benefit and other housing-related programs to help you buy, build, repair, retain, or adapt a home for your own personal occupancy. VA Home Loans are provided by private lenders, such as banks and mortgage companies. VA Guarantees a portion of the loan, enabling the lender to provide you with more favorable terms.

Purchase Loans and Cash out Refinance Loans

A Purchase Loan helps you purchase a home at a competitive interest rate often without requiring a down payment or private mortgage insurance. With a Purchase Loan, VA can help you purchase a home at a competitive interest rate, and if you have found it difficult to find other financing.

VA's Cash-Out Refinance Loan is for homeowners who want to take cash out of your home equity to take care of concerns like paying off debt, funding school, or making home improvements. The Cash-Out Refinance Loan can also be used to refinance a non-VA loan into a VA loan. VA will Guaranty loans up to 100% of the value of your home.

Interest Rate Reduction Refinance Loan (IRRRL)

The VA Interest Rate Reduction Refinance Loan (IRRRL) lowers your interest rate by refinancing your existing VA home loan. By obtaining a lower interest rate, your monthly mortgage payment should decrease. You can also refinance an adjustable rate mortgage (ARM) into a fixed rate mortgage.


  • No appraisal or credit underwriting package is required when applying for an IRRRL.
  • An IRRRL may be done with "no money out of pocket" by including all costs in the new loan or by making the new loan at an interest rate high enough to enable the lender to pay the costs.
  • When refinancing from an existing VA ARM loan to a fixed rate loan, the interest rate may increase.
  • 8No lender is required to give you an IRRRL, however, any VA lender of your choosing may process your application for an IRRRL.
  • Veterans are strongly urged to contact several lenders because terms may vary.
  • You may NOT receive any cash from the loan proceeds.

An IRRRL can only be made to refinance a property on which you have already used your VA loan eligibility. It must be a VA to VA refinance, and it will reuse your original entitlement.


  • A Certificate of Eligibility (COE) is not required. If you have your Certificate of Eligibility, take it to the lender to show the prior use of your entitlement.
  • No loan other than the existing VA loan may be paid from the proceeds of an IRRRL. If you have a second mortgage, the holder must agree to subordinate that lien so that your new VA loan will be a first mortgage.
  • You may have used your entitlement by obtaining a VA loan when you bought your house, or by substituting your eligibility for that of the seller, if you assumed the loan.
  • The occupancy requirement for an IRRRL is different from other VA loans. For an IRRRL you need only certify that you previously occupied the home.

Application Process
A new Certificate of Eligibility (COE) is not required. You may take your Certificate of Eligibility to show the prior use of your entitlement or your lender may use our e-mail confirmation procedure in lieu of a certificate of eligibility.

Loan Limits
VA does not set a cap on how much you can borrow to finance your home. However, there are limits on the amount of liability VA can assume, which usually affects the amount of money an institution will lend you. The loan limits are the amount a qualified Veteran with full entitlement may be able to borrow without making a down payment. These loan limits vary by county, since the value of a house depends in part on its location.

The basic entitlement available to each eligible Veteran is $36,000. Lenders will generally loan up to four times a Veteran's available entitlement without a down payment, provided the Veteran is income and credit qualified and the property appraises for the asking price.

VA Funding Fee

Generally, all Veterans using the VA Home Loan Guaranty benefit must pay a funding fee. This reduces the loan's cost to taxpayers considering that a VA loan requires no down payment and has no monthly mortgage insurance. The funding fee is a percentage of the loan amount which varies based on the type of loan and your military category, if you are a first-time or subsequent loan user, and whether you make a down payment. You have the option to finance the VA funding fee or pay it in cash, but the funding fee must be paid at closing time. You do not have to pay the fee if you are a:

  • Veteran receiving VA Compensation for a service-connected disability, OR
  • Veteran who would be entitled to receive Compensation for a service-connected disability if you did not receive retirement or active duty pay, OR
  • Surviving spouse of a Veteran who died in service or from a service-connected disability.

The funding fee for second time users who do not make a down payment is slightly higher. Also, National Guard and Reserve Veterans pay a slightly higher funding fee percentage. Some lenders offer IRRRLs as an opportunity to reduce the term of your loan from 30 years to 15 years. While this can save you money in interest over the life of the loan, you may see a very large increase in your monthly payment if the reduction in the interest rate is not at least one percent (two percent is better). Beware: It could be a bigger increase than you can afford.

Native American Direct Loan (NADL) Program

Since 1992, the Native American Veteran Direct Loan (NADL) program has provided eligible Native American Veterans and their spouses the opportunity to use their Department of Veterans Affairs (VA) home loan Guaranty benefit on Federal trust land.

What is a NADL?
VA provides direct home loans to eligible Native American Veterans to finance the purchase, construction, or improvement of homes on Federal Trust Land, or to refinance a prior NADL to reduce the interest rate.

Why Use the NADL Program?

  • The lender is the Department of Veterans Affairs
  • Dedicated VA staff to assist you
  • No down payment
  • Easy to qualify
  • No Private Mortgage Insurance cost
  • 4.25% interest rate. Interest rates are subject to change due to market fluctuations. VA evaluates these market trends and determines if interest rate reductions or increases are warranted.
  • Low closing costs
  • $424,100 loan maximum limit in most areas; some high-cost counties have higher loan limits
  • Fixed-rate 30-year mortgage
  • Re-usable benefit

How to Use the NADL Program
To obtain a NADL, the law requires that the tribal government must have signed a Memorandum of Understanding (MOU) with the Secretary of Veterans Affairs. The MOU spells out the conditions under which the program will operate on its trust lands.

Am I Eligible to Use the NADL Program?

  • You must have a valid Certificate of Eligibility to be eligible for the VA home loan benefit and have available entitlement. Please visit this page for information on how to get a Certificate of Eligibility.
  • The loan must be to purchase, construct, or improve a home on Federally-recognized trust, allotted lands, Alaska Native corporations and Pacific Island territories.
  • You must occupy the property as your home.
  • You must be a satisfactory credit risk.
  • Your income and that of your spouses, if any, must be shown to be stable and sufficient to meet the mortgage payments, cover the other costs of owning a home, take care of other obligations and expenses, and have enough left over for family support.

Education Benefits

Post 9-11 GI Bill (Chapter 33)

Chapter 33 was enacted in the "Post 9-11 Veterans Educational Assistance Act of 2008" (P.L. 110-252), and greatly expanded education benefits on August 1, 2009. The Veterans Educational Assistance Improvement Act of 2010 (P.L. 111-377), signed into law on January 4, 2011, amended the Post 9-11 GI Bill by expanding eligibility for certain individuals, and modifying the amount of assistance and the types of approved programs. The Choice Act extended the Fry scholarship to spouses, and allows VA to disapprove courses of education in which the state charges Veterans or service members higher rates than that of in-state residents.

Eligibility to use chapter 33 benefits lasts for 15 years from last period of active duty service based on at least 90 consecutive days of active duty service. Students generally have up to 36 months of entitlement. Based on length of active duty service and training rate, students are entitled to a percentage of the following:

  • Full cost of tuition and fees for all public school in-state students, or up to $21,084.89 (as of August 1, 2015) for those attending out-of-state, private or foreign schools;
  • Monthly housing allowance equal to the basic allowance for housing payable to a military E-5 with dependents, in the same zip code as the school (paid to student);
  • Yearly books and supplies stipend of up to $1,000 per year (paid to student);
  • A one-time payment of $500 to certain individuals relocating from highly rural areas (paid to student);
  • Payments for those pursuing a non-IHL program such as a non-college degree (NCD), on the job training (OJT), apprenticeship training, flight programs, or a correspondence program; and
  • Other benefits such as the Yellow Ribbon program, kickers, and refund of chapter 30 payroll deductions will also be available to certain students.

The Yellow Ribbon G.I. Education Enhancement Program was enacted to potentially assist eligible Chapter 33 individuals with payment of their tuition and fees in instances where costs exceed the most expensive in-state undergraduate tuition at a public institution of higher education. To be eligible, the student must be: a Veteran receiving benefits at the 100 percent benefit rate payable; a transfer-of-entitlement-eligible dependent child; or a transfer-of- entitlement eligible spouse of a Veteran. The school of attendance must have accepted VA's invitation to participate in the program, state how much student tuition will be waived (up to 50 percent) and how many participants will be accepted into the program during the current academic year. VA will match the school's percentage (up to 50 percent) to reduce or eliminate out-of-pocket costs for eligible participants.

The Marine Gunnery Sergeant John David Fry Scholarship entitles children and spouses (with the enactment of the Veterans Choice Act) of those who die in the line of duty on or after September 11, 2001, to use Post-9-11 GI Bill benefits. Eligible children are entitled to 36 months of benefits at the 100 percent level and have 15 years to use the benefit beginning on their 18th birthday. These beneficiaries are not eligible for the Yellow Ribbon Program. In addition to the Fry Scholarships, certain members of the Armed Forces who are still on active duty may be eligible to transfer benefits to a spouse or dependent children based on DoD policy.

All-Volunteer Force Educational Assistance Program/Montgomery GI Bill (Chapter 30)
The predecessor of Chapter 33 program, and still in wide use, the Chapter 30 VA educational benefits may be used while the service member is on active duty or after the service member's separation from active duty with a fully honorable military discharge. Discharges "under honorable conditions" and "general" discharges do not establish eligibility. Eligibility generally expires 10 years after the service member's discharge. However, there are exceptions for disability, re-entering active duty, and upgraded discharges.

Effective October 1, 2015, the rate for full-time training in college, technical or vocational school will be $1,789 a month for those who served three years or more or two years plus four years in the Selected Reserve. For those who served less than three years, the monthly rate is $1,454. Benefits are reduced for part-time training. Payments for other types of training follow different rules. VA will pay an additional amount, called a "kicker" or "college fund," if directed by DoD. The maximum number of months Veterans can receive payments is 36 months at the full-time rate or the part-time equivalent.

The following types of education and training are available under Chapter 30:

  • Courses at colleges and universities leading to associate, bachelor or graduate degrees, including accredited independent study offered through distance education;
  • Courses leading to a certificate or diploma from business, technical or vocational schools;
  • Apprenticeship or on-the-job training for those not on active duty, including self- employment training begun on or after June 16, 2004, for ownership or operation of a franchise;
  • Correspondence courses, under certain conditions;
  • Flight training, if the Veteran holds a private pilot's license upon beginning the training and meets the medical requirements;
  • State-approved teacher certification programs;
  • Preparatory courses necessary for admission to a college or graduate school;
  • License and certification tests approved for Veterans; and
  • Entrepreneurship training courses to create or expand small businesses.

Survivors' and Dependents' Educational Assistance (Chapter 35)

Chapter 35 provides education and training opportunities to eligible dependents of certain Veterans. The program offers up to 45 months of education benefits. These benefits may be used for degree and certificate programs, apprenticeship, and on-the-job training. A spouse may take a correspondence course. Remedial, deficiency, and refresher courses may be approved under certain circumstances.

To be eligible, one must be the son, daughter, or spouse of:

  • A Veteran who died or is permanently and totally disabled as the result of a service- connected disability. The disability must arise out of active service in the Armed Forces;
  • A Veteran who died from any cause while such permanent and total service-connected disability was in existence;
  • A service member missing in action or captured in line of duty by a hostile force;
  • A service member forcibly detained or interned in line of duty by a foreign government or power; or
  • A service member who is hospitalized or receiving outpatient treatment for a service connected permanent and total disability and is likely to be discharged for that disability. (This change was effective December 23, 2006.)

A son or daughter must be between the ages of 18 and 26 to receive benefits for attending school or job training. If you are in the Armed Forces, you may not receive this benefit while on active duty. For spouses, benefits end 10 years from the date VA finds you eligible or from the date of death of the Veteran, unless the VA rated the Veteran permanently and totally disabled, in which case a spouse may remain eligible for 20 years from the effective date of the rating. For surviving spouses (spouses of service members who died on active duty) benefits end 20 years from the date of death.

Educational Assistance for Members of the Selected Reserve (MGIB-SR) (Chapter 1606)

Chapter 1606 may be available to a member of the Selected Reserve if they meet the eligibility requirements established by their respective components. The Selected Reserve includes the Army Reserve, Navy Reserve, Air Force Reserve, Marine Corps Reserve and Coast Guard Reserve, and the Army National Guard and the Air National Guard. The program may be used for degree programs, certificate or correspondence courses, cooperative training, independent study programs, apprenticeship/on-the-job training, and vocational flight training programs. Remedial, refresher and deficiency training are available under certain circumstances. Up to 36 months of education benefits may be available.

Specific eligibility requirements include:

  • Have a six-year obligation to serve in the Selected Reserve signed after June 30, 1985. For some types of training, it is necessary to have a six-year commitment that begins after September 30, 1990;
  • Complete initial active duty for training (IADT);
  • Meet the requirement to receive a high school diploma or equivalency certificate before completing IADT; and
  • Remain in good standing while serving in an active Selected Reserve unit.

In addition, a discharge from Selected Reserve service due to a disability or being ordered to active duty may extend eligibility for the program beyond service in a Selected Reserve unit.

Reserve Educational Assistance Program (REAP) (Chapter 1607)

Chapter 1607 was established as a part of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005. It is a DoD education benefit program designed to provide educational assistance to members of the Reserve components called or ordered to active duty in response to a war or national emergency (contingency operation) as declared by the President or Congress. This program makes certain reservists who were activated for at least 90 days after September 11, 2001 either eligible for education benefits or eligible for increased benefits.

Some reservists may contribute up to an additional $600 to the GI Bill to receive increased monthly benefits. For an additional $600 contribution, they may receive up to $5,400 in additional GI Bill benefits. One must be a member of a Ready Reserve component (Selected Reserve, Individual Ready Reserve, or Inactive National Guard) to pay into the "buy-up" program.

Reserve Educational Assistance Program (REAP)

REAP provides educational assistance to members of the Reserve components called or ordered to active duty in response to a war or national emergency declared by the president or Congress.

Change in REAP Eligibility
The National Defense Authorization Act of 2016 ended REAP on November 25, 2015. Some individuals will remain eligible for REAP benefits until November 25, 2019; while others are no longer eligible for REAP benefits.

The Post-9-11 GI Bill in many ways has replaced REAP because it also provides educational assistance benefits for Reserve and National Guard members called to active duty on or after September 11, 2001, and in many cases provides a greater benefit than REAP.

We are committed to ensuring that Reservists, National Guard members, and Veterans understand this change, and we are working to identify individuals who no longer have eligibility for REAP and inform them of potential eligibility to other benefit programs. This change affects beneficiaries differently:

Current Reap Beneficiaries
Veterans who were attending an educational institution on November 24, 2015, or during the last semester, quarter, or term ending prior to that date, are eligible to continue to receive REAP benefits until November 25, 2019.

Reap Beneficiaries Not Attending School
Veterans who applied for REAP but were not attending an educational institution on November 24, 2015, or during the last semester, quarter, or term ending prior to that date, are no longer eligible to receive REAP benefits. You may be eligible to receive benefits under the Post-9-11 GI Bill.

New Reap Applicants
Veterans who have not enrolled in school and applied for REAP benefits prior to November 25, 2015, are no longer eligible for REAP benefits. However, in most cases, you will be eligible for the Post-9-11 GI Bill.

You may be eligible for Post-9-11 GI Bill benefits depending on the dates of your periods of service. If we receive a new application for REAP on or after November 25, 2015, we will evaluate your eligibility for all programs, including Post-9-11 GI Bill, and may award you benefits under a different program.

If you're using REAP but would like to learn how to make an irrevocable election to use the Post-9-11 GI Bill instead, please call us at 1-888-GIBILL-1 (7 a.m. – 6 p.m. CST Monday – Friday) to speak with an Education Call Center Agent.

Veterans Educational Assistance Program (VEAP)

VEAP is available if you elected to make contributions from your military pay to participate in this education benefit program. The government matches your contributions on a 2-for-1 basis.

Types of Training
Assistance may be used for college degree and certificate programs, technical or vocational courses, flight training, apprenticeships or on-the-job training, high-tech training, licensing and certification tests, entrepreneurship training, certain entrance examinations, and correspondence courses. In certain circumstances, remedial, deficiency, and refresher training may also be available. Get the VEAP pamphlet.

You may use these benefits for degree, certificate, correspondence, apprenticeship/on-the-job training programs, and vocational flight training programs.

Available Benefits and Eligibility
Benefit entitlement is for one to 36 months depending on the number of monthly contributions. You have 10 years from your release from active duty to use VEAP benefits. If the entitlement is not used after the 10-year period, your portion remaining in the fund will be automatically refunded.

You must meet the following requirements to qualify:

  • Entered service for the first time between Jan. 1, 1977, and June 30, 1985
  • Opened a contribution account before April 1, 1987
  • Voluntarily contributed from $25 to $2,700;
  • Completed your first period of service and were discharged or released from service under conditions other than dishonorable.
  • If you are currently on active duty and wish to receive VEAP benefits, you must have at least three months of contributions available.

Other Factors to Consider

Contributions may be withdrawn if you do not meet the basic eligibility requirements or if you formally request a refund of the contributions withheld.

To apply, take these steps depending on your situation:

  • Make sure that your selected program is approved for VA training. VA can inform you and the school or company about the requirements.
  • Obtain and complete VA Form 22-1990, Application for Education Benefits. Send it to the VA Regional Office with jurisdiction over the state where you will pursue education and training. If you are not on active duty, send copy 4 (Member Copy) of your DD 214, Certificate of Release or Discharge From Active Duty.
  • If you are on active duty, you must have your enrollment approved by your base Education Services Officer, and you must have your service verified by your Commanding Officer.
  • If you have started training, take your application and Member Copy of DD 214 to your school or employer. Ask them to complete VA Form 22-1999, Enrollment Certification, and send all the forms to VA.
  • If you wish to withdraw your contributions from VEAP, obtain and complete VA Form 22-5281, Application for Refund of Educational Contributions, and send it to your nearest VA Regional Office.

Educational Assistance Pilot Program

The Educational Assistance Pilot Program, created by the Department of Defense Authorization Act of 1981 (Public Law 96-342), allows for the payment of monthly education benefits to encourage enlistment and reenlistment in the U.S. Armed Forces. Benefits may be available to individuals who entered on active duty after Sept. 30, 1980, and before Oct. 1, 1981 (or before Oct. 1, 1982, if entry was under a delayed enlistment contract signed between Sept. 30, 1980, and Oct. 1, 1981). (Note: Although this law established a start date for the test program as Oct. 1, 1980, the military service departments did not start offering the test program to new enlistees until Dec. 1, 1980.)

Air Force Eligibility Requirements
Service members must meet all three of the following criteria to be eligible for this benefit : Must have enlisted between Dec. 1, 1980, and Sept. 30, 1981 Enlistment was in one of the following Air Force Specialties: 20723, 20731, 20830, 46130, 46230A, B, C, D, E, F, G, H, J, or Z, 46430, 81130

Enlistment must have taken place at one of the following locations: Beckley, W.V.; Buffalo, N.Y.; Dallas ; Fargo, N.D.; Houston ; Jackson, Miss. ; Louisville, Ky.; Memphis, Tenn.; Omaha, Neb.; Philadelphia; Seattle; Sioux Falls, S.D.; Syracuse, N.Y.

National Testing Program

Advancing your education often requires you to take costly national tests. Students can be reimbursed all required (mandatory) fees charged for national admission tests and national tests for college credit.

Type of Assistance
The following tests are approved for reimbursement:

  • SAT (Scholastic Assessment Test)
  • LSAT (Law School Admission Test)
  • GRE (Graduate Record Exam)
  • GMAT (Graduate Management Admission Test)
  • AP (Advanced Placement Exam)
  • CLEP (College-Level Examination Program)
  • ACT (American College Testing Program)
  • DAT (Dental Admissions Test)
  • MAT (Miller Analogies Test)
  • MCAT (Medical College Admissions Test)
  • OAT (Optometry Admissions Testing)
  • PCAT (Pharmacy College Admissions Test)
  • TOEFL (Test of English as a Foreign Language)
  • DSST (DANTES Subject Standardized Tests)
  • ECE (Excelsior College Examinations)
  • PLA (Prior Learning Assessment) testing through
  • TECEP (Thomas Edison College Examination Program)

Available Benefits
Although VA will reimburse a Veteran for required test fees, some fees connected to the testing process are not covered. The following test fees may be covered:

  • Registration fees
  • Fees for specialized tests
  • Administrative fees
  • The following fees are not covered by VA:
    • Fees to take pre-tests (such as Kaplan tests)
    • Fees to receive scores quickly
    • Other costs or fees for optional items which are not required to take an approved test
    • You do not normally have to submit a receipt or proof of payment for the test. However, in these situations, proof of payment is necessary: DSST tests and in certain situations related to CLEP, MAT, and PCAT tests. Mail the documentation to the Regional Office that handles your claim or use the Ask a Question section of our website to send us the information required and attach copies of any required documents.

Follow these steps to apply: First apply for GI Bill benefits. Complete a VA Form 22-0810 (Application for Reimbursement of National Exam Fee).

National Call to Service Program

This National Call to Service Incentive program is a benefit provided to those who perform a period of national service. It is a Department of Defense program that is administered by VA.

Type of Assistance
Participants who elect to receive an educational assistance incentive are not entitled to additional assistance under Chapter 1606 or Chapter 30 benefits unless the participant completes the service requirements necessary to establish eligibility. An individual who receives benefits under this program who also establishes eligibility under Chapter 1606 or Chapter 30 will have those entitlements reduced accordingly.

Available Benefit and Eligibility
Participants can choose from the following incentives:

  • Cash bonus of $5,000
  • Repayment of a qualifying student loan not to exceed $18,000
  • Entitlement to allowance equal to the three-year monthly Montgomery GI Bill Active-Duty rate for 12 months
  • Entitlement to allowance equal to 50 percent of the less than three-year monthly Montgomery GI Bill Active-Duty rate for 36 months
  • Coordination with Montgomery GI Bill Benefits

There is a three-tiered service requirement to qualify for incentives

  • First, after completion of initial entry training, individuals must serve on active duty in a military occupational specialty designated by the Secretary of Defense for a period of 15 months.
  • After this, and without a break in service, these individuals must serve either an additional period of active duty as determined by the Secretary of Defense, or a period of 24 months in an active status in the Selected Reserve.
  • After completion of this period of service, and without a break in service, the remaining period of obligated service specified in the agreement will be served as follows:
    • On active duty in the armed forces
    • In the Selected Reserve
    • In the Individual Ready Reserve
    • In AmeriCorps, or another domestic national service program jointly designated by the Secretary of Defense and the head of such a program
    • Any combination of the service referred to above may also be approved by the Secretary of the military department concerned pursuant to regulations prescribed by the Secretary of Defense and specified in the agreement.