VA Home Loans

The short version

The VA home loan is one of the most valuable benefits you earn in uniform. It lets eligible service members, veterans, and many surviving spouses buy a primary home with no down payment and no private mortgage insurance (PMI), backed by a partial guaranty from the Department of Veterans Affairs.

You still borrow from a regular lender, and you still qualify on income and credit. What the VA does is guarantee part of the loan, which is why lenders can offer better terms than a conventional mortgage.

Zero down, no PMI, and a one-time funding fee

Two things make the VA loan stand out: no down payment for buyers with full entitlement, and no monthly mortgage insurance. In exchange, most borrowers pay a one-time VA funding fee, which you can roll into the loan.

What you get

• No down payment with full entitlement.
• No PMI, ever.
• Competitive rates and limits on some closing costs.
• A reusable benefit you can use more than once.

What it costs

• Funding fee, first use, $0 down: 2.15%.
• Subsequent use, $0 down: 3.3%.
• Waived if you receive VA disability compensation.
• A down payment of 5% or more lowers the fee.

With full entitlement there is no VA loan limit. Lenders set the maximum based on what you can repay, not a county cap.

Source: VA.gov, Funding fee and loan limits

Run the numbers before you fall for a house

Zero down is powerful, but it means you start with little or no equity, and the funding fee adds to your balance. Before you shop, compare a VA loan against a conventional loan with the down payment you could actually make, and look at the monthly payment, the fee, and how long you plan to stay.

VetraFi has a VA Home Loan tool that walks through how the benefit works and lets you compare loan types side by side. Use it before you talk to a lender so you walk in knowing the questions to ask.

Compare loan types with the VetraFi VA Home Loan calculator.

Eligibility and entitlement, briefly

Most members qualify after a minimum period of service, and Guard and Reserve members can qualify too. You prove eligibility with a Certificate of Eligibility (COE), which your lender can usually pull in minutes. Full entitlement means you have not used the benefit, or you repaid a prior VA loan and sold the home. If you already have a VA loan, you may have remaining entitlement, which can still work but may require a down payment on a second purchase.

Watch-outs

The VA loan is for a primary residence you intend to live in, not a rental or vacation home. The home must pass a VA appraisal and meet minimum property requirements. And not every seller or agent understands VA loans, so work with people who do.

Do this now

1. Request your COE or ask a VA-savvy lender to pull it.
2. Compare VA vs. conventional with the VetraFi VA Home Loan tool before you shop.
3. Check whether your funding fee is waived (VA disability compensation).
4. Get pre-approved so you know your real budget and can make a strong offer.

FAQ

Do I really need zero down?

You can put nothing down with full entitlement, but a down payment lowers your funding fee and builds equity faster. Choose based on your cash and goals.

Is there a VA loan limit?

Not with full entitlement. Your lender sets the maximum based on income and credit. Limits can apply if you have reduced (remaining) entitlement.

Who is exempt from the funding fee?

Veterans receiving VA compensation for a service-connected disability, some Purple Heart recipients, and certain surviving spouses. Confirm your status with the VA or your lender.

Can I use the VA loan more than once?

Yes. It is a reusable benefit. Once you repay a VA loan and sell the home, your full entitlement is restored.

Sources & links

• VA, VA-backed home loan types and eligibility: va.gov
• VA, Funding fee and closing costs: va.gov
• VA, Loan limits and entitlement: va.gov
• VetraFi, VA Home Loan tool: recruit.vetrafi.com/va-loan