01Why the VA loan is so powerful
The VA home loan was built for the people who served. It rewards veterans, active duty service members, and eligible surviving spouses with terms no other loan can match. Here is what sets it apart.
0% Down
Finance up to 100% of the purchase price. No down payment required on most purchases, so you keep your savings.
No Monthly Mortgage Insurance
Conventional and FHA loans charge monthly mortgage insurance. The VA loan never does, which keeps your payment lower.
Competitive Rates
VA rates are often lower than conventional rates, even with zero money down. More buying power for the same payment.
Flexible Credit
There is no VA set minimum score. The VA looks at your full picture, and recent on time payment history carries real weight.
Residual Income, Not Just Ratios
The VA uses a residual income test, so strong borrowers who fall outside rigid debt to income limits can still qualify.
Reusable for Life
This is not a one time benefit. Use it again and again, as long as you have entitlement available.
Assumable
A qualified buyer can take over your VA loan and your low rate when you sell. That can be a powerful selling point.
No Prepayment Penalty
Pay extra toward principal or pay the loan off early at any time, with no penalty.
02Who is eligible
The VA loan is available across every branch: Army, Marine Corps, Navy, Air Force, Coast Guard, and Space Force. Eligibility comes down to your length and type of service, with a discharge under conditions other than dishonorable.
| Service type | Minimum service requirement |
|---|---|
| Wartime | 90 days of active service |
| Peacetime | 181 days of continuous active service |
| Service Sep 1980 to Aug 1990 | 24 months of continuous active service, or the full period you were called to active duty (at least 181 days) |
| National Guard and Reserve | 6 years of service, or 90 days of active service under qualifying activation |
Wartime periods
- September 1940 to July 1947
- June 1950 to January 1955
- February 1961 to May 1975
- August 1990 to present day
Peacetime periods
- July 1947 to June 1950
- February 1955 to August 1964
- May 1975 to September 1980
Also eligible
- Discharged for a service connected disability
- Surviving spouse of a veteran who died in service or from a service connected disability (in most cases, not remarried before age 57)
- Spouse of a service member who is a POW or MIA
- Certain Public Health Service and NOAA service members
03Your Certificate of Eligibility
Your Certificate of Eligibility, or COE, is the document that proves to a lender you qualify for the VA benefit and shows how much entitlement you have available. You will need it before your loan can move forward.
Three ways to get it
- Through your VA loan specialist (fastest). In most cases I can pull your COE in minutes once I have your basic service information. This is by far the easiest route.
- Online at VA.gov. Sign in with your Login.gov or ID.me account, go to your home loan benefits, and request the COE. If your records are on file, you can download it right away.
- By mail. Complete VA Form 26-1880 and send it with proof of service to the Regional Loan Center that serves your state. This is the slowest option.
What you may need
- Veterans: your DD214
- Active duty: a statement of service signed by your command
- Guard and Reserve: NGB 22, NGB 23, or a points statement
- Surviving spouses: VA Form 26-1817, or call 877.827.3702 and follow the prompts for eligibility
Good to know
- A COE confirms eligibility. It is not loan approval by itself.
- Your basic entitlement helps the lender finance with no down payment.
- If a prior VA loan is paid off and the home sold, your full entitlement can be restored.
04The VA funding fee
The VA funding fee is a one time fee paid to the VA. It keeps the program running at no cost to taxpayers and takes the place of the monthly mortgage insurance other loans charge. It can be financed into your loan, so it does not have to come out of pocket.
Purchase and construction loans
| Down payment | First use | Subsequent use |
|---|---|---|
| Less than 5% | 2.15% | 3.30% |
| 5% to 9.99% | 1.50% | 1.50% |
| 10% or more | 1.25% | 1.25% |
Refinance and other uses
| Loan type | First use | Subsequent use |
|---|---|---|
| Cash out refinance | 2.15% | 3.30% |
| Streamline refinance (IRRRL) | 0.50% | 0.50% |
| Loan assumption | 0.50% | 0.50% |
Rates shown took effect April 2023 and remain in effect. Your exact fee depends on your service, down payment, and prior use. I will confirm your figure before you commit to anything.
05Understanding your costs
The VA does not set your interest rate or most of your loan costs. Your lender does. That's why shopping your lender, or working with a mortgage broker who can shop around for you, matters. Some lenders charge no lender fees at all, and that difference can be real money.
Common lender and closing costs
- Interest rate (the biggest lever on your payment)
- Discount points (optional, paid to buy down your rate)
- Origination, processing, and underwriting
- Appraisal fee
- Title and escrow
- Recording and doc preparation
- Prepaid taxes and insurance
What makes up your monthly payment
- Principal
- Interest
- Property taxes
- Homeowners insurance
- Flood insurance (only if the home is in a flood zone)
- HOA dues and any maintenance fee (condo or townhome)
06Minimum Property Requirements
The VA wants the home you buy to be safe, structurally sound, and sanitary. These standards are called Minimum Property Requirements, or MPRs, and a VA appraiser checks for them. They exist to protect you from buying a home with serious hidden problems.
What an appraiser looks for
- Working heat, electrical, and plumbing
- Safe water supply and proper sewage or septic
- A sound roof with reasonable remaining life
- No active leaks, exposed wiring, or major structural issues
- Safe and reliable access to the property
- No chipping or peeling paint on homes built before 1978 (lead based paint)
- Termite report in regions where it is required
Why it matters to you
- MPRs are a built in inspection of the home's condition
- Knowing them before you write an offer keeps you from chasing a home that will not pass
- Repairs flagged by the appraiser can often be negotiated with the seller
- A VA savvy agent writes offers around these realities from the start
- Most flagged items are minor and fixable, not deal breakers
07VA loan myths, busted
A lot of bad information keeps veterans from using a benefit they earned. Let us clear up the big ones.
08Tips for a smooth VA loan
A great experience is mostly about preparation and the people you choose. These five habits make the biggest difference.
- Choose a VA specialist, not just any lender. Work with someone who closes VA loans every month and knows the guidelines cold. Experience here protects you.
- Get fully preapproved, not just prequalified. A real preapproval means your income, assets, and credit are verified and run through automated underwriting. It makes your offer stronger.
- Use a VA savvy agent. The VA has unique property requirements. An agent who understands them writes offers that sellers accept and homes that pass.
- Do not open new credit or make big purchases. Avoid new accounts, financed furniture, or a new car while in process. Even a credit inquiry can cause a hiccup. Wait until after you close.
- Communicate and trust the process. The mortgage process asks for a lot of documents, sometimes the same one twice. It is normal, and it is all there to protect your approval.
Have these ready
- DD214 or statement of service
- W2s and tax returns for 2 years
- Photo ID and Social Security number
- Most recent 30 days of pay stubs
- Recent bank and asset statements
- Your COE, which I pull for you
09Building wealth with the VA loan
Most veterans never realize their VA loan can be the engine that starts a real estate portfolio. Here is the real path one of my clients took, step by step, all with the benefit he earned and zero money down.
Meet Matthew
Active duty start
Matthew is serving and wants to buy a home, with hopes of owning rental property one day.
He learns the play
He can buy a 2 to 4 unit home at his duty station and rent the other units to help cover the mortgage.
Buys a duplex, 0% down
Day one he is both a homeowner and a landlord, with no down payment on his first property.
PCS, rents both sides
He moves to a new station and rents out both units. The income now covers the full mortgage.
Buys again, 0% down
He uses his remaining entitlement to buy a single family home at his new duty station.
Rents by the room
He moves again and rents the home room by room to service members for even stronger income.
10Your VA home buying checklist
Print this and follow it from first call to keys in hand. This is the path from start to finish.
11Building new: VA One Time Close
Want to build instead of buy? The VA One Time Close lets you finance the land, the construction, and your permanent mortgage in a single loan with one closing. Your rate is locked before you break ground, and there is no requalifying once the home is finished.
- 0% down, just like a VA purchase
- No mortgage payments during the build. The interest is built into the builder's budget
- One closing and one set of closing costs, not two
- Funds release to your builder in scheduled draws as work is finished
- Primary residence only, with 1 to 4 unit options where you occupy one unit
- Construction must be finished within 11 months
- Build on land you own or roll the lot purchase into the loan
- Your builder needs lender approval. The VA no longer requires a separate VA Builder ID
12Common questions answered
Can I buy a condo or townhome?
Yes, as long as the project is VA approved. I can check a project's approval status for you before you fall in love with a unit.
Can the seller pay my closing costs?
Yes. Sellers can pay your closing costs and offer certain concessions. Paired with 0% down, that can mean very little cash needed to close.
What credit score do I need?
There is no VA set minimum. Many lenders look for the low 600s, and stronger profiles earn better terms. Recent on time payments matter more than people expect.
How long does it take to close?
A typical purchase runs on a normal timeline, often around 30 days when your file is complete and your team is responsive.
Can I have two VA loans at the same time?
Yes, if you have enough remaining entitlement. This is the foundation of the wealth strategy earlier in this guide.
What if the appraisal comes in low?
You have options, including renegotiating the price, the Tidewater process, or a formal Reconsideration of Value. We work through it together rather than panicking.
Do I have to be a first time buyer?
No. The benefit is for any eligible veteran or service member, and you can use it as many times as your entitlement allows.
Can I buy a manufactured home?
In some cases, yes, with conditions that vary by lender and property type. Ask me about your specific situation.