HOME LOAN GUARANTY

FARM LOANS: VA HOME LOANS FOR RURAL RESIDENTS

Disabilities determined by VA to be related to your military service can lead to monthly non-taxable compensation, enrollment in the 

VA health care system, a 10-point hiring preference for federal employment and other important benefits. Ask your VA 

representative or Veterans Service Organization representative about Disability Compensation, Pension, Health Care, Caregiver

Program, Career Services, Educational Assistance, Home Loan Guaranty, Insurance and/or Dependents and Survivors’ Benefits.

OVERVIEW

The Department of Veterans Affairs’ (VA) Home Loan benefit may be used to purchase a farm on 

which there is a farm residence to be owned and occupied by a Veteran as his or her primary 

residence. Although the VA Home Loan benefit cannot be used for business loans, including for 

farming, Veterans can use the benefit to purchase a farm on which there is a residence. 

GENERAL GUIDANCE

Loans for farm dwellings are appraised the same way as for homes in urban areas.

 VA does not set limits on the number of acres a VA-guaranteed property may have. 

 The appraisal of properties with acreage should not present difficulties if a sufficient number of 

similar properties in the area were recently sold primarily for residential use, and may include 

improvements not typically considered residential (i.e. barns, sheds, corrals, stables, pastures). 

 For VA purposes, the valuation must not include livestock, crops, or farm equipment and 

supplies. In any case, individual improvements not typically considered residential (i.e. barns, 

sheds, corrals, stables, pastures) will be valued at their fair market value.

Underwriting guidelines are generally the same as for non-farm type dwellings. 

 For example, if some or all of the income necessary to support the loan payments comes from 

farming operations, a Veteran’s ability and experience as a farm operator must be established. 

 The procedures and analysis provided in Chapter 4 of VA Pamphlet 26-7, Lenders Handbook, 

under “Self-Employment Income” generally apply.

3 EASY STEPS TO A VA HOME LOAN

1. Apply online for a Certificate of Eligibility (COE) or by mail using VA Form 26-1880, Request 

for Certificate of Eligibility. Lenders can also obtain COEs for Veterans online.
Home Loan Guaranty –February 2015 

2. Find a realtor and lender to help navigate you through the process of buying a home. The 

lender will complete an application and work with you to determine the amount of loan for 

which you qualify. After you provide a pre-qualification or pre-approval to the realtor they will 

be able to show you homes within that price range. Select a home and sign a purchase 

agreement or a contract with a builder. It is important to note that your sales contract should 

include a provision making it void if you are unable to attain VA-guaranteed financing. 

3. The lender will then order an appraisal of the property, and help you clear the final conditions 

required to close on your new home. 

For more information, contact a VA Regional Loan Center by calling toll-free (877) 827-3702 or visit 

our Home Loan website.