VA Loans

VA home loans offered through the Department of Veterans Affairs are available not only to active duty service members, but qualified veterans and many others as well. VA loans are not made by the VA, but guaranteed by the department, allowing lenders to provide veterans and military members better interest rates and loan terms.

The VA Loan Guaranty Program was started in 1944 as a means to assist returning service members with affordable home loans. Over the last 70 years, more than 18 million veterans have taken advantage of this program.

VA loans are very flexible. Along with using a VA mortgage to buy a home, you can also use a loan to build a home, refinance an existing VA mortgage, take cash out of a home, make repairs or improvements to an existing home, or even make energy efficient improvements.

Benefits of a VA Mortgage

VA loans are widely viewed as the best mortgage program available today for many reasons. A VA loan does not require a down payment, and it is far easier to qualify for a VA mortgage than a conventional loan. In fact, around 80% of all VA borrowers would not be able to qualify for a conventional loan.

VA Loan Costs

You can typically obtain a VA mortgage without a down payment or even paying any closing costs out of pocket. A VA loan does require a funding fee, however. The funding fee depends several factors.

For Regular Military Members

• No down payment: 2.15% funding fee
• 5% to 9.9% down payment: 1.50% fee
• 10% or greater down: 1.25% funding fee

For National Guard and Reservists

• No down payment: 2.4% funding fee
• 5% to 9.9% down: 1.75% fee
• 10% or greater down payment: 1.50% funding fee

Not sure if a VA mortgage is right for you? VA home loans are almost always the best choice if you qualify, especially if you have limited credit or little saved for a down payment. It is very hard to beat the competitive rates, looser credit standards, and no down payment of a VA-backed mortgage.