What is a certificate of eligibility?

A certificate of eligibility serves as a crucial document that certifies a veteran's entitlement to a VA loan, which is a benefit provided by the U.S. Department of Veterans Affairs. This document confirms that the veteran meets the necessary criteria to qualify for this specific type of mortgage, helping them secure financing to purchase a home. By distinguishing the eligibility status of veterans, it facilitates their access to favorable loan terms without the need for a down payment, as well as lower interest rates and no private mortgage insurance requirements.

The other options do not pertain to the specific function of a certificate of eligibility. For instance, a document indicating the current market value of a property would be an appraisal or a comparative market analysis, which assesses property value based on market data. A title document confirming clear ownership would involve legal papers such as a deed or title report, establishing who holds ownership title to a property. Lastly, an appraisal report provides an estimate of a property's value based on various factors but does not verify eligibility for a loan. The primary focus of the certificate is explicitly tied to the verification of veterans' loan benefits, making option B the correct and relevant answer.