Title 38 — Veterans' BenefitsRelease 119-73
§3702 Basic entitlement
Title 38 › Part PART III— - READJUSTMENT AND RELATED BENEFITS › Chapter CHAPTER 37— - HOUSING AND SMALL BUSINESS LOANS › Subchapter SUBCHAPTER I— - GENERAL › § 3702
Summary
Allows veterans to get VA housing loan benefits if they meet certain service rules. If a veteran served in more than one qualifying period, the most recent period’s entitlement replaces earlier unused entitlement and is reduced by any amount already used to get a VA loan on property the veteran owns or where the VA paid a loss, unless the veteran later repaid that debt in full. Eligible groups include veterans with 90 or more days in World War II, the Korean conflict, the Vietnam era, or the Persian Gulf War (with some exceptions); veterans discharged for a service-connected disability after September 15, 1940; those who served more than 180 days after July 25, 1947 and were not discharged dishonorably (or who remain on continuous active duty); sole-survivor discharges of 90+ days; and a few other groups named elsewhere in VA law. Any unused World War II or Korean War entitlement that expired under old rules before October 23, 1970 is restored and won’t expire. The VA may stop counting prior used entitlement in certain cases, such as when the secured property was sold or destroyed and the loan is repaid or the VA’s liability or loss is settled; when a transferee assumes the loan and uses their entitlement; or when the old loan is repaid and the new loan uses the same property. An honorable discharge counts as a certificate of eligibility; others can apply to the VA for one. Lenders must report loans to the VA, and the VA issues a guaranty certificate and records amounts used and remaining. Loans are automatically guaranteed when made by regulated banks, state lenders, or VA-approved lenders; the VA can approve other lenders and may require 30 days’ notice for prior approval. Loans with at least 20% VA guaranty can be made by many types of banks without following usual limits on loan-to-value, loan term, required security, lien order, or how much of assets can be in real estate loans.
Full Legal Text
Title 38, §3702
Veterans' Benefits — Source: USLM XML via OLRC
(a)(1)The veterans described in paragraph (2) of this subsection are eligible for the housing loan benefits of this chapter. In the case of any veteran who served on active duty during two or more of the periods specified in paragraph (2) for which eligibility for the housing loan benefits under this chapter may be granted, entitlement derived from service during the most recent such period (A) shall cancel any unused entitlement derived from service during any earlier such period, and (B) shall be reduced by the amount by which entitlement from service during any earlier such period has been used to obtain a direct, guaranteed, or insured housing loan—
(i)on real property which the veteran owns at the time of application; or
(ii)as to which the Secretary has incurred actual liability or loss, unless in the event of loss or the incurrence and payment of such liability by the Secretary the resulting indebtedness of the veteran to the United States has been paid in full.
(2)The veterans referred to in the first sentence of paragraph (1) of this subsection are the following:
(A)Each veteran who served on active duty at any time during World War II, the Korean conflict, or the Vietnam era and whose total service was for 90 days or more.
(B)Each veteran who after September 15, 1940, was discharged or released from a period of active duty for a service-connected disability.
(C)Each veteran, other than a veteran described in clause (A) or (B) of this paragraph, who—
(i)served after July 25, 1947, for a period of more than 180 days and was discharged or released therefrom under conditions other than dishonorable; or
(ii)has served more than 180 days in active duty status and continues on active duty without a break therein.
(D)Each veteran who served on active duty for 90 days or more at any time during the Persian Gulf War, other than a veteran ineligible for benefits under this title by reason of section 5303A(b) of this title.
(E)Each veteran described in section 3701(b)(5) of this title.
(F)Each veteran who was discharged or released from a period of active duty of 90 days or more by reason of a sole survivorship discharge (as that term is defined in section 1174(i) of title 10).
(G)Each individual described in section 3701(b)(7) of this title.
(3)Any unused entitlement of World War II or Korean conflict veterans which expired under provisions of law in effect before October 23, 1970, is hereby restored and shall not expire until used.
(4)A veteran’s entitlement under this chapter shall not be reduced by any entitlement used by the veteran’s spouse which was based upon the provisions of paragraph (3) of section 3701(b) of this title.
(b)In computing the aggregate amount of guaranty or insurance housing loan entitlement available to a veteran under this chapter, the Secretary may exclude the amount of guaranty or insurance housing loan entitlement used for any guaranteed, insured, or direct loan under the following circumstances:
(1)(A)The property which secured the loan has been disposed of by the veteran or has been destroyed by fire or other natural hazard; and
(B)the loan has been repaid in full, or the Secretary has been released from liability as to the loan, or if the Secretary has suffered a loss on such loan, the loss has been paid in full.
(2)A veteran-transferee has agreed to assume the outstanding balance on the loan and consented to the use of the veteran-transferee’s entitlement, to the extent that the entitlement of the veteran-transferor had been used originally, in place of the veteran-transferor’s for the guaranteed, insured, or direct loan, and the veteran-transferee otherwise meets the requirements of this chapter.
(3)(A)The loan has been repaid in full; and
(B)the loan for which the veteran seeks to use entitlement under this chapter is secured by the same property which secured the loan referred to in subparagraph (A) of this paragraph.
(4)In a case not covered by paragraph (1) or (2)—
(A)the loan has been repaid in full and, if the Secretary has suffered a loss on the loan, the loss has been paid in full; or
(B)the Secretary has been released from liability as to the loan and, if the Secretary has suffered a loss on the loan, the loss has been paid in full.
(c)An honorable discharge shall be deemed to be a certificate of eligibility to apply for a guaranteed loan. Any veteran who does not have a discharge certificate, or who received a discharge other than honorable, may apply to the Secretary for a certificate of eligibility. Upon making a loan guaranteed or insured under this chapter, the lender shall forthwith transmit to the Secretary a report thereon in such detail as the Secretary may, from time to time, prescribe. Where the loan is guaranteed, the Secretary shall provide the lender with a loan guaranty certificate or other evidence of the guaranty. The Secretary shall also endorse on the veteran’s discharge, or eligibility certificate, the amount and type of guaranty used, and the amount, if any, remaining. Nothing in this chapter shall preclude the assignment of any guaranteed loan or the security therefor.
(d)Housing loans will be automatically guaranteed under this chapter only if made (1) by any Federal land bank, national bank, State bank, private bank, building and loan association, insurance company, credit union, or mortgage and loan company, that is subject to examination and supervision by an agency of the United States or of any State, or (2) by any State, or (3) by any lender approved by the Secretary pursuant to standards established by the Secretary. Any housing loan proposed to be made to a veteran pursuant to this chapter by any lender not of a class specified in the preceding sentence may be guaranteed by the Secretary if the Secretary finds that it is in accord otherwise with the provisions of this chapter.
(e)The Secretary may at any time upon thirty days’ notice require housing loans to be made by any lender or class of lenders to be submitted to the Secretary for prior approval. No guaranty or insurance liability shall exist with respect to any such loan unless evidence of guaranty or insurance is issued by the Secretary.
(f)Any housing loan at least 20 percent of which is guaranteed under this chapter may be made by any national bank or Federal savings and loan association, or by any bank, trust company, building and loan association, or insurance company, organized or authorized to do business in the District of Columbia. Any such loan may be so made without regard to the limitations and restrictions of any other law relating to—
(1)ratio of amount of loan to the value of the property;
(2)maturity of loan;
(3)requirement for mortgage or other security;
(4)dignity of lien; or
(5)percentage of assets which may be invested in real estate loans.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
Amendments
2021—Subsec. (a)(2)(G). Pub. L. 116–315 added subpar. (G). 2008—Subsec. (a)(2)(F). Pub. L. 110–317 added subpar. (F). 2003—Subsec. (a)(2)(E). Pub. L. 108–183 substituted “Each” for “For the period beginning on
October 28, 1992, and ending on
September 30, 2009, each”. 2001—Subsec. (a)(2)(E). Pub. L. 107–103 substituted “
September 30, 2009” for “
September 30, 2007”. 1999—Subsec. (a)(2)(E). Pub. L. 106–117 substituted “
September 30, 2007” for “
September 30, 2003”. 1998—Subsec. (a)(2)(E). Pub. L. 105–368 substituted “
September 30, 2003” for “
October 27, 1999”. 1994—Subsec. (a)(2)(E). Pub. L. 103–446, § 1201(f)(4), substituted “For the period beginning on
October 28, 1992, and ending on
October 27, 1999,” for “For the 7-year period beginning on the date of enactment of this subparagraph,”. Subsec. (b). Pub. L. 103–446, § 902(1), (6), (7), in introductory provisions, substituted “loan under the following circumstances:” for “loan, if—”, and in concluding provisions, substituted “paragraph (1)” for “clause (1) of the preceding sentence” and inserted at end “The authority of the Secretary under this subsection to exclude an amount of guaranty or insurance housing loan entitlement previously used by a veteran may be exercised only once for that veteran under the authority of paragraph (4).” Subsec. (b)(1). Pub. L. 103–446, § 902(2), substituted “The property” for “the property” in subpar. (A) and a period for the semicolon at end of subpar. (B). Subsec. (b)(2). Pub. L. 103–446, § 902(3), substituted “A veteran-transferee” for “a veteran-transferee” and a period for “; or” at end. Subsec. (b)(3)(A). Pub. L. 103–446, § 902(4), substituted “The loan” for “the loan”. Subsec. (b)(4). Pub. L. 103–446, § 902(5), added par. (4). 1992—Subsec. (a)(2)(E). Pub. L. 102–547 added subpar. (E). 1991—Pub. L. 102–83, § 5(a), renumbered section 1802 of this title as this section. Subsec. (a)(2)(D). Pub. L. 102–40 substituted “5303A(b)” for “3103A(b)”. Pub. L. 102–25 added subpar. (D). Subsec. (a)(4). Pub. L. 102–83, § 5(c)(1), substituted “3701(b)” for “1801(b)”. 1989—Subsecs. (a)(1)(ii), (b). Pub. L. 101–237, § 313(b)(1), substituted “Secretary” for “Administrator” wherever appearing. Subsec. (b)(3). Pub. L. 101–237, § 310, added par. (3). Subsecs. (c) to (e). Pub. L. 101–237, § 313(b)(1), substituted “Secretary” for “Administrator” wherever appearing. 1988—Subsec. (a)(1). Pub. L. 100–322, § 415(a)(1)(A)–(E), designated existing provisions as par. (1), substituted “The veterans described in paragraph (2) of this subsection are eligible for the housing loan benefits of this chapter” for “Each veteran who served on active duty at any time during World War II, the Korean conflict, or the Vietnam era and whose total service was for ninety days or more, or who was discharged or released from a period of active duty, any part of which occurred during World War II, the Korean conflict, or the Vietnam era, for a service-connected disability, shall be eligible for the housing loan benefits of this chapter”, substituted “in paragraph (2)” for “in the preceding sentence, or in section 1818 of this title,” and redesignated former cls. (1) and (2) as cls. (A) and (B), respectively, and former cls. (A) and (B) as subcls. (i) and (ii), respectively. Subsec. (a)(2), (3). Pub. L. 100–322, § 415(a)(1)(F), added pars. (2) and (3). Subsec. (a)(4). Pub. L. 100–322, § 415(a)(2), redesignated subsec. (g) as (a)(4) and substituted “1801(b)” for “1801(a)”. Subsec. (g). Pub. L. 100–322, § 415(a)(2)(B), redesignated subsec. (g) as (a)(4). 1984—Subsec. (b)(2). Pub. L. 98–223 substituted “a” for “an immediate”. 1982—Subsec. (f). Pub. L. 97–295 substituted “percent” for “per centum”. 1981—Subsec. (a). Pub. L. 97–72, § 303(b)(1), (2), substituted “the housing loan benefits” for “the benefits” in two places and “insured housing loan” for “insured loan”. Subsec. (b). Pub. L. 97–72, § 303(b)(3), substituted “insurance housing loan entitlement” for “insurance entitlement” in two places. Subsec. (d). Pub. L. 97–72, § 303(b)(4), (5), substituted “Housing loans will be automatically guaranteed” for “Loans will be automatically guaranteed” and “Any housing loan proposed” for “Any loan proposed”. Subsec. (e). Pub. L. 97–72, § 303(b)(6), substituted “require housing loans” for “require loans”. Subsec. (f). Pub. L. 97–72, § 303(b)(7), substituted “Any housing loan at least” for “Any loan at least”. 1978—Subsec. (a). Pub. L. 95–476, § 102(a), inserted provisions entitling Vietnam era veterans to the benefits of this chapter and including such veterans in the cancellation of unused entitlement derived from earlier service and the reduction of current entitlement provisions of this subsection. Subsec. (b). Pub. L. 95–476, § 102(b), redesignated cl. (1) as (1)(A), cl. (2) as (B), cl. (3) as (2), and struck out reference to cl. (2) in provision authorizing the Administrator to waive certain conditions prescribed in this subsection. 1976—Subsec. (b). Pub. L. 94–324, § 7(3), substituted “the Administrator deems” for “he deems” and “the veteran-transferee’s entitlement” for “his entitlement”. Subsec. (c). Pub. L. 94–324, § 7(4), substituted “The Administrator” for “He”. Subsec. (d). Pub. L. 94–324, § 7(4), substituted “the Administrator” for “him” and “he”. Subsec. (e). Pub. L. 94–324, § 7(5), substituted “the Administrator” for “him” in first sentence. Subsec. (g). Pub. L. 94–324, § 7(5), substituted “the veteran’s spouse” for “his wife”. 1974—Subsec. (b). Pub. L. 93–569, § 2(a), expanded provisions so as to permit restoration of a veteran’s entitlement to a guaranteed, insured, or direct loan provided any prior loan has been paid in full, and the property has been disposed of by the veteran, or any immediate veteran-transferee has agreed to the use of his veteran’s entitlement. Subsec. (d)(3). Pub. L. 93–569, § 2(b), substituted provisions relating to any lender approved by Administrator pursuant to standards established by him, for provisions relating to approval of mortgagees by Secretary of Housing and Urban Development and designated by him as certified agent. 1970—Subsec. (b). Pub. L. 91–506 struck out loan eligibility expiration dates for World War II and Korean conflict veterans. Subsec. (g). Pub. L. 91–584 added subsec. (g). 1967—Subsec. (b). Pub. L. 90–77 extended loan program for certain World War II veterans from
July 26, 1967 to
July 26, 1970. Subsec. (d). Pub. L. 90–19 substituted “mortgagee approved by the Secretary of Housing and Urban Development and designated by him” for “Federal Housing Administration approved mortgagee designated by the Federal Housing Commissioner”. 1961—Subsec. (b). Pub. L. 87–84 substituted in last sentence “by a World War II veteran at any time before
July 26, 1967, and by a Korean conflict veteran at any time before
February 1, 1975” for “at any time before
February 1, 1965”. 1959—Subsec. (d)(3). Pub. L. 86–73 added cl. (3).
Statutory Notes and Related Subsidiaries
Effective Date
of 2021 AmendmentAmendment by Pub. L. 116–315 applicable with respect to full-time National Guard duty (as defined in section 101 of title 10, United States Code) performed before, on, or after Jan. 5, 2021, see section 2101(c) of Pub. L. 116–315, set out as a note under section 3701 of this title.
Effective Date
of 2008 AmendmentAmendment by Pub. L. 110–317 applicable with respect to any sole survivorship discharge granted after Sept. 11, 2001, see section 10 of Pub. L. 110–317, set out as a note under section 2108 of Title 5, Government Organization and Employees.
Effective Date
of 1998 AmendmentAmendment by Pub. L. 105–368 effective Oct. 1, 1998, see section 602(f) of Pub. L. 105–368, set out as a note under section 2106 of this title.
Effective Date
of 1981 AmendmentAmendment by Pub. L. 97–72 effective at end of 180-day period beginning on Nov. 3, 1981, see section 305 of Pub. L. 97–72, set out as an
Effective Date
note under section 3741 of this title.
Effective Date
of 1978 Amendment Pub. L. 95–476, title I, § 108, Oct. 18, 1978, 92 Stat. 1502, provided that: “(a) Except as provided in subsection (b) of this section, the
Amendments
made by this title [see Tables for classification] shall take effect on
October 1, 1978. “(b) The amendment made by clause (1) of section 104 of this title [amending section 1810 [now 3710] shall take effect on
July 1, 1979, except with respect to the authority to prescribe
Regulations
for the implementation of such amendment, which shall be effective on the date of the enactment of this Act [Oct. 18, 1978].”
Effective Date
of 1976 AmendmentAmendment by Pub. L. 94–324 effective June 30, 1976, see section 9(a) of Pub. L. 94–324, set out as a note under section 3701 of this title.
Effective Date
of 1974 Amendment Pub. L. 93–569, § 10, Dec. 31, 1974, 88 Stat. 1867, provided that: “The provisions of this Act [see Tables for classification] shall become effective on the date of enactment [Dec. 31, 1974] except that the
Amendments
made by section 2(a)(3) [amending section 1802 [now 3702] of this title] and 2(b) [amending section 1802 [now 3702] of this title] and section 3(2) [amending section 1810 [now 3710] of this title] and 3(4) [amending section 1810 [now 3710] of this title] shall become effective ninety days after such date of enactment [Dec. 31, 1974].”
Effective Date
of 1967 AmendmentAmendment by Pub. L. 90–77 effective first day of first calendar month which begins more than ten days after Aug. 31, 1967, see section 405 of Pub. L. 90–77, set out as a note under section 101 of this title. Annual Reports on Veterans Receiving Guaranteed Mortgage Loans as Result of
Amendments
by Pub. L. 102–547 Pub. L. 102–547, § 2(c), Oct. 28, 1992, 106 Stat. 3634, directed Secretary of Veterans Affairs to transmit report on selected reserve veterans receiving guaranteed mortgage loans to Committees on Veterans’ Affairs of Senate and House of Representatives no later than Dec. 31, 1994, and annually thereafter, prior to repeal by Pub. L. 104–110, title II, § 201(b), Feb. 13, 1996, 110 Stat. 770. References in Other Laws Pub. L. 100–322, title IV, § 415(c)(7),
May 20, 1988, 102 Stat. 551, provided that: “Any reference, in effect on the date of the enactment of this Act [
May 20, 1988], in any law, rule, or regulation to any of the sections, or parts thereof, which are redesignated or transferred by this section [section 1802(a), (g), 1815, 1816(a) to (c), 1816(d) to (f), 1817, 1817A, 1819, and 1832 of this title were redesignated as section 1802(a)(1), (4), 1803(a)(2), 1832(a) to (c), 1833(a) to (c), 1813, 1814, 1812, and 1833(d) [now 3702(a)(1), (4), 3703(a)(2), 3732(a) to (c), 3733(a) to (c), 3713, 3714, 3712, and 3733(d)], respectively, of this title] shall be construed to refer to the section, or part thereof, as redesignated or transferred by this section.” Technical Nature of 1986
Amendments
Pub. L. 100–322, title IV, § 415(f), May 20, 1988, 102 Stat. 552, provided that: “The status of any veteran with respect to benefits under chapter 37 of title 38, United States Code, shall not be affected by the
Amendments
made by, or other provisions of, this section [see Tables for classification].”
Reference
Citations & Metadata
Citation
38 U.S.C. § 3702
Title 38 — Veterans' Benefits
Last Updated
Apr 6, 2026
Release point: 119-73