Overview
The VA home loan is one of the best mortgage products available anywhere. It allows eligible veterans to purchase a home with zero down payment, no private mortgage insurance (PMI), and competitive interest rates. Understanding how it works can save you tens of thousands of dollars.
Key Benefits
- No down payment required — Buy a home with $0 down
- No PMI — Private mortgage insurance is never required, even with 0% down
- Competitive interest rates — Typically lower than conventional loans
- Limited closing costs — The VA limits what lenders can charge
- No prepayment penalty — Pay off your loan early without fees
- Reusable — You can use your VA loan benefit multiple times
- Assumable — A buyer can take over your VA loan (potentially valuable in high-rate environments)
Eligibility
Service Requirements
- Active duty: 90 continuous days during wartime, or 181 days during peacetime
- Post-9/11: 90 days of active duty service
- National Guard/Reserves: 6 years of service, or 90 days of active duty (including activation orders)
- Surviving spouses: Un-remarried spouses of veterans who died in service or from a service-connected disability
Certificate of Eligibility (COE)
You need a COE to prove your eligibility. Get it through:
- VA.gov (fastest)
- Your lender (many can pull it instantly)
- By mail using VA Form 26-1880
The VA Loan Process
- Get your COE
- Get pre-approved with a VA-approved lender
- Find a home (work with a real estate agent familiar with VA loans)
- Make an offer and sign a purchase agreement
- VA appraisal — The VA sends an appraiser to verify the home meets minimum property requirements and is worth the purchase price
- Underwriting — The lender finalizes your loan
- Closing — Sign the paperwork and get your keys
The VA Funding Fee
The VA charges a one-time funding fee that helps sustain the loan program. It varies based on:
- Whether it's your first VA loan use or subsequent
- Your down payment amount
- Whether you're Regular Military, Reserves, or National Guard
Exemptions from the funding fee:
- Veterans receiving VA disability compensation
- Surviving spouses
- Purple Heart recipients on active duty
If you have a service-connected disability rating, you don't pay the funding fee. This saves you thousands of dollars. If you paid a funding fee and later received a disability rating, you can get a refund.
Common Misconceptions
"You can only use a VA loan once"
False. You can use your VA loan benefit multiple times. You can even have more than one VA loan at a time if you have remaining entitlement.
"VA loans are slow"
Not anymore. Most VA loans close in 30-45 days, comparable to conventional loans.
"Sellers don't like VA loans"
This stigma is fading, especially as VA appraisal timelines and processes have improved. A strong offer is a strong offer regardless of loan type.
"VA loans are only for first-time buyers"
False. There is no first-time buyer requirement.
Tips
- Shop multiple lenders — Rates and fees vary significantly between VA-approved lenders
- Get your disability rating first if possible — it exempts you from the funding fee
- VA loan entitlement can be restored after selling a home or paying off the loan
- The VA Minimum Property Requirements (MPRs) can cause issues with fixer-uppers — the home must be safe, structurally sound, and sanitary