VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement

va-m26-7-ch02

VA Pamphlet 26-7 Chapter 2 governs Veteran eligibility and entitlement for VA-guaranteed loans.

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source:
  type: regulation
  id: va-m26-7-ch02
  authority: VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement
  description: |
    VA Pamphlet 26-7 Chapter 2 governs Veteran eligibility and
    entitlement for VA-guaranteed loans.
  effective_date: '2019-03-28'
obligations:
  - id: va-m26-7-ch02-establish-eligibility-before-appraisal
    canonical_id: va-m26-7-ch02-establish-eligibility-before-appraisal
    section: VA M26-7 Ch. 2, Topic 1, Subsection b — The Lender's Role
    description: |
      [LENDER] must ensure the applicant is an eligible Veteran before an
      appraisal is ordered, and the loan cannot be processed or closed
      until eligibility is established. VA cannot guarantee a loan for an
      ineligible Veteran.
    type: do
    audit_question: For every VA loan application, can [LENDER] evidence that the applicant was confirmed as an eligible Veteran (via a Certificate of Eligibility from WebLGY) BEFORE the appraisal was ordered and BEFORE the loan was processed or closed?
    program_review: Does the workflow ensure Veteran eligibility (via COE from WebLGY) is established BEFORE the appraisal is ordered and before the loan is processed or closed?
    file_review: Pull a sample; confirm a valid COE preceded the appraisal order and loan processing/closing.
    judgment: false
    feeds: []
    workflow_phase: origination
    owner_role: loan_officer
    secondary_owner_role: underwriter
    cadence: per_loan
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - va
      - m26-7
      - ch02
      - eligibility
      - coe
      - promoted
    primary_source:
      tier: 1
      authority: VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement
      source_class: va-handbook-m26-7
      source_url: https://benefits.va.gov/WARMS/M26_7.asp
      snapshot_id: 488cf6b152dfffb7
      fetched_at: '2026-05-23T01:50:00Z'
      content_hash: sha256:b9f2259ef4bf182c8700374d01f483bbad8bde952afea193cdbca84386d635e6
      paragraph_quote: The lender must ensure the applicant is an eligible Veteran before an appraisal is ordered, the loan cannot be processed or closed.
      drafter_attestation: Copied verbatim from VA Handbook snapshot 488cf6b152dfffb7 (M26-7 Ch. 2, Topic 1b — The Lender's Role) at 2026-05-23. Source PDF retrieved via Wayback Machine.
      quote_healed: true
      effective_date: '2019-03-28'
      effective_date_source: va-change-date-preceding
    promoted_at: '2026-05-23T01:59:41+00:00'
    promoted_from: va-m26-7-ch02-roundb-v1.yaml
  - id: va-m26-7-ch02-comply-coe-conditions
    canonical_id: va-m26-7-ch02-comply-coe-conditions
    section: VA M26-7 Ch. 2, Topic 2 — What the Certificate of Eligibility Tells the Lender
    description: |
      [LENDER] must be sure to comply with all "conditions" appearing near
      the middle portion of the Certificate of Eligibility, including
      funding-fee exempt or non-exempt status and any other conditions the
      COE places on the guaranty.
    type: do
    audit_question: For every VA loan, can [LENDER] evidence that the conditions appearing on the COE (funding-fee status, ADSM continuous-active-duty certification, etc.) were identified and complied with prior to closing, and that documentation supporting compliance is retained?
    program_review: Does the program ensure the conditions on the COE (funding-fee status, ADSM continuous-active-duty certification, other guaranty conditions) are identified and complied with before closing, with supporting documentation retained?
    file_review: Pull a sample; confirm each COE condition was identified, complied with, and documented before closing.
    judgment: false
    feeds: []
    workflow_phase: origination
    owner_role: loan_officer
    secondary_owner_role: closer
    cadence: per_loan
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - va
      - m26-7
      - ch02
      - coe-conditions
      - funding-fee
      - promoted
    primary_source:
      tier: 1
      authority: VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement
      source_class: va-handbook-m26-7
      source_url: https://benefits.va.gov/WARMS/M26_7.asp
      snapshot_id: 488cf6b152dfffb7
      fetched_at: '2026-05-23T01:50:00Z'
      content_hash: sha256:b9f2259ef4bf182c8700374d01f483bbad8bde952afea193cdbca84386d635e6
      paragraph_quote: 'Lenders must be sure to comply with all “conditions” appearing near the middle portion of the COE: • For COEs with “exempt” status, the following “conditions” may appear: a) Funding Fee – Veteran is exempt from the funding fee due to receipt of service-connected disability compensation of $ _______________________monthly.'
      drafter_attestation: Copied verbatim from VA Handbook snapshot 488cf6b152dfffb7 (M26-7 Ch. 2, Topic 2 — COE conditions) at 2026-05-23. Source PDF retrieved via Wayback Machine.
      quote_healed: true
      glyphs_normalized: true
      effective_date: '2019-03-28'
      effective_date_source: va-change-date-preceding
    promoted_at: '2026-05-23T01:59:41+00:00'
    promoted_from: va-m26-7-ch02-roundb-v1.yaml
  - id: va-m26-7-ch02-coe-ace-first
    canonical_id: va-m26-7-ch02-coe-ace-first
    section: VA M26-7 Ch. 2, Topic 3 — How to Apply for a Certificate of Eligibility
    description: |
      [LENDER] must first attempt to obtain a COE through the Automatic
      Certificate of Eligibility (ACE) application, which can be accessed
      through the VIP. If a COE cannot be obtained immediately, the lender
      submits an electronic application via the WebLGY link.
    type: do
    audit_question: For every VA loan, can [LENDER] evidence it first attempted to obtain the COE through the ACE application via VIP, and that any subsequent electronic application via WebLGY is documented if ACE did not return a COE immediately?
    program_review: Does the workflow ensure the COE is first attempted through ACE via VIP, with a documented WebLGY electronic application only where ACE does not return a COE immediately?
    file_review: Spot-check files; confirm the ACE-first attempt and any documented WebLGY fallback.
    judgment: false
    feeds: []
    workflow_phase: origination
    owner_role: loan_officer
    secondary_owner_role: ''
    cadence: per_loan
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - va
      - m26-7
      - ch02
      - ace
      - weblgy
      - promoted
    primary_source:
      tier: 1
      authority: VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement
      source_class: va-handbook-m26-7
      source_url: https://benefits.va.gov/WARMS/M26_7.asp
      snapshot_id: 488cf6b152dfffb7
      fetched_at: '2026-05-23T01:50:00Z'
      content_hash: sha256:b9f2259ef4bf182c8700374d01f483bbad8bde952afea193cdbca84386d635e6
      paragraph_quote: Lenders must first attempt to obtain a COE through the ACE application, which can be accessed through the VIP.
      drafter_attestation: Copied verbatim from VA Handbook snapshot 488cf6b152dfffb7 (M26-7 Ch. 2, Topic 3 — How to Apply for a COE) at 2026-05-23. Source PDF retrieved via Wayback Machine.
      quote_healed: true
      effective_date: '2019-03-28'
      effective_date_source: va-change-date-preceding
    promoted_at: '2026-05-23T01:59:41+00:00'
    promoted_from: va-m26-7-ch02-roundb-v1.yaml
_promotion_history:
  - promoted_at: '2026-05-23T01:59:41+00:00'
    candidate_path: obligations\_remediation\_round_b_drafts\va-m26-7-ch02-roundb-v1.yaml
    candidates_promoted: 3
    candidates_skipped_existing: 0

Verbatim regulatory text (3)

Verbatim provisions from VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.

VA M26-7 Ch. 2, Topic 1, Subsection b — The Lender's Role

Effective 2019-03-28 · VA Change Date for this topic

The lender must ensure the applicant is an eligible Veteran before an appraisal is ordered, the loan cannot be processed or closed.

Source: VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement · source URL · snapshot 488cf6b152dfffb7

VA M26-7 Ch. 2, Topic 2 — What the Certificate of Eligibility Tells the Lender

Effective 2019-03-28 · VA Change Date for this topic

Lenders must be sure to comply with all “conditions” appearing near the middle portion of the COE: • For COEs with “exempt” status, the following “conditions” may appear: a) Funding Fee – Veteran is exempt from the funding fee due to receipt of service-connected disability compensation of $ _______________________monthly.

Source: VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement · source URL · snapshot 488cf6b152dfffb7

VA M26-7 Ch. 2, Topic 3 — How to Apply for a Certificate of Eligibility

Effective 2019-03-28 · VA Change Date for this topic

Lenders must first attempt to obtain a COE through the ACE application, which can be accessed through the VIP.

Source: VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement · source URL · snapshot 488cf6b152dfffb7

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Operationalizing VA Lender Handbook M26-7 Chapter 2 — Veteran's Eligibility and Entitlement

This is verbatim, source-snapshotted regulator text from the Claude for Compliance open corpus. To turn a rule like this into compliance work product: gap-analyze your policies and procedures (P&Ps) against these requirements to surface stale, conflicting, or missing provisions; operationalize any change with a ready-to-run update kit; and produce audit-ready evidence — every step grounded only in the regulator’s own words, never invented.

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Source of record: https://claudeforcompliance.com/regs/va-m26-7-ch02/ · register va-m26-7-ch02 · Claude for Compliance. Free to read and download; see regulatory updates and methodology.