The Complete Guide to VA Home Loans: Eligibility, Benefits, and How to Apply
Helping Veterans and Active Duty Members Make the Most of Their VA Loan Benefits
Millions of veterans and active duty service members are eligible to purchase a home with no money down and no mortgage insurance, yet many don’t take advantage of this powerful benefit. This guide is here to change that.
We’ll break down the most common questions about VA home loans, including eligibility, benefits, costs, and the application process, so you can confidently use your VA loan benefit.
What Is a VA Loan?
A VA loan is a mortgage backed by the U.S. Department of Veterans Affairs, designed to help qualified veterans, service members, and some surviving spouses buy a home.
Important note: The VA does not lend money. Instead, loans are issued by private lenders like banks, credit unions, and mortgage brokers. Always verify that your lender understands VA loan guidelines and isn’t misrepresenting themselves as the VA.
Key Benefits of VA Loans
- No Down Payment: Finance 100% of the home’s purchase price.
- No Mortgage Insurance: Unlike conventional and FHA loans, VA loans do not require monthly mortgage insurance premiums.
- Lower Interest Rates: VA loans typically offer lower rates—often about 0.5% less than conventional loans.
- Flexible Credit Requirements: Borrowers with lower credit scores can still qualify and receive the same rate as higher-credit applicants.
- Limited Closing Costs: Lenders are restricted from charging certain fees, which can save you money at closing.
Who Is Eligible?
- Active Duty Service Members: Must serve at least 90 consecutive days.
- Veterans: Must have received an honorable discharge and meet minimum service requirements.
- National Guard and Reserves: Typically require 6 years of service or 90 days of active duty.
- Surviving Spouses: May qualify if the veteran died in service or from service-connected causes.
To confirm eligibility, obtain your Certificate of Eligibility (COE) through the VA’s eBenefits portal, or let your lender request it during pre-approval.
Common Myths About VA Loans
- You can use a VA loan more than once.
- VA loans are not just for first-time homebuyers.
- VA loans are not complicated; they’re actually one of the most lenient loan types.
- Sellers are not automatically against VA loans—often they just need to be better educated.
What Types of Properties Can You Buy?
The home must be your primary residence. Acceptable property types include:
- Single-family homes
- Condos (must be VA-approved)
- Townhomes
- Duplexes (you must live in one unit)
You can also use a VA loan to build, renovate, or refinance a home—including a VA Streamline Refinance that doesn’t require an appraisal or income verification.
How to Apply for a VA Loan
Do not rely on Google searches to find a VA lender. Many top results are paid advertisements from companies that charge higher rates and fees. Some also apply stricter qualification standards (overlays) than the VA requires.
Instead, work with a trusted, VA-knowledgeable lender. The process usually involves:
- Initial consultation with a lender
- Filling out a loan application
- Providing documentation: pay stubs, W-2s, bank statements, and COE
- Credit report review
Once approved, your lender will tell you the home price range you qualify for—likely with no money down.
Costs Associated with VA Loans
- VA Funding Fee: 2.15% of the loan amount (first-time use). This is usually rolled into the loan.
- Closing Costs: Typically 2–3% of the purchase price. These may be covered by the seller or lender, but you should plan to have some funds available.
- Monthly Payment: Consists of principal, interest, property taxes, and homeowners insurance. No mortgage insurance is required.
Important: Because the funding fee is financed, you’ll owe more than the home is worth at closing. Plan to stay in the home 5–10 years to build equity and avoid losses when selling.
Can You Use a VA Loan More Than Once?
Yes. You can use your VA loan benefit multiple times, as long as you have sufficient entitlement remaining. Selling your current home with a VA loan typically restores full entitlement.
If you keep the property, you may still be eligible to use the loan again, but it might require a down payment depending on your remaining entitlement.
Final Thoughts
VA loans are among the most powerful tools available to veterans and active duty service members. If you qualify, it should be one of the first options you explore.
That said, your lender should provide side-by-side comparisons with other loan types (conventional, FHA) so you can make
