Direct VA Loans

VA Form 26-8937 and Benefits Verification

VA Form 26-8937, otherwise known as Verification of VA Benefits, is used by VA mortgage lenders if a potential borrower fits one of the following criteria:

  • Veteran currently receives VA disability payments
  • Veteran has received VA disability payments in the past
  • Veteran receives retired pay in lieu of VA disability payments 
  • Veteran filed a claim for VA disability benefits prior to discharge from active duty service
  • Surviving spouse of a veteran who died on active duty or as a result of a service-connected disability

Form 26-8937 for VA Funding Fee Waivers

The form serves as evidence that a borrower receives VA disability compensation, has a non-service-connected pension, or has been rated by the VA as incompetent. Form 26-8937 must be submitted prior to loan approval by potential borrowers who have been rated as incompetent as their loan cannot be closed automatically.

In many cases, these VA borrowers will receive VA funding fee waivers, which could result in a savings of .5 percent to 3.3 percent depending on the type of VA loan. Also, borrowers who meet the criteria after a VA loan is obtained may be eligible for a refund of the VA funding fee after closing.

To complete VA Form 26-8937, the borrower must provide the necessary information. Borrowers should be prepared to provide the following information in order for lenders to complete VA Form 26-8937:

  1. Veteran/Applicant name
  2. Current Address
  3. Birth Date
  4. VA Claim Folder Number (C-File Number, if known)
  5. Social Security Number
  6. Service Number (if different than SSN)
  7. Records of any VA benefit-related Indebtedness

The Veteran/Applicant name must match what the VA has on record for a veteran disability or surviving spouse claim. And, the address provided should be the current place of residence, not the address of the home that is being purchased.

When a disability or surviving spouse claim is made, the VA assigns a number to reference the claim file (C-file). When a lender asks for the VA claim folder number, they are referring to the C-file number. It’s best if an applicant knows the number, but it is not required on the VA Form 26-8937.

Next, the form requires a social security and service number. Military members may sometimes serve under their social security number (SSN) and never be issued a service number. Therefore, it may only be necessary to provide a SSN if a service number was not used.

VA Mortgage Qualifying Requires Paid VA Debts

The final section of VA Form 26-8937 asks applicant to relay VA benefit-related indebtedness to the best of his or her knowledge. VA benefit-related indebtedness can occur if the borrower has:

  • Received an overpayment of VA education, compensation, or pension benefits

  • Defaulted on a VA education loan or direct VA home loan 
  • VA debt resulting from payment of a claim on a prior guaranteed home loan

  • Delayed repayment plans for any of these debts

Once the applicant signs a completed VA Form 26-8937, the lender will submit it to the appropriate VA Regional Loan Center for processing. The processed form is to be retained by the lenders as part of the loan origination package.  

For more information about obtaining a VA home loan and the forms required, be sure to contact a seasoned VA loan professional.

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