A VA home loan is a mortgage backed by the Department of Veterans Affairs that lets may be able to access service members and veterans buy a home with no down payment and no mortgage insurance

The VA does not lend the money itself. Instead, a bank or mortgage lender makes the loan, and the VA guarantees a portion of it — meaning if you stop paying, the VA will cover part of the lender's loss. That may provide is what lets lenders offer terms they would not otherwise give: no down payment required, no private mortgage insurance (PMI), and often a lower interest rate than a conventional loan.

You must have served on active duty, in the reserves, or in the National Guard to be may be able to access. The length of service required depends on when you served. The VA issues a Certificate of may be able to access that proves to a lender that you may have access to. You can request this certificate through the VA website or through your lender, and the process usually takes a few days to a few weeks.

Key Takeaways

  • A VA home loan requires no down payment and no private mortgage insurance, which are the two largest costs that keep many buyers out of homeownership.
  • The VA guarantees the loan but does not lend the money — you borrow from a bank or mortgage company that participates in the VA program.
  • You need a Certificate of may be able to access from the VA before a lender will consider your process, and you can request it online or through your lender.
  • VA loans have a one-time funding fee (usually 2 to 3 percent of the loan amount) that you can pay upfront or roll into your mortgage.
  • You can use a VA loan more than once, and if you have already used it, you may be able to restore your may be able to access after you sell the home.

How the VA may provide works and what it means for you

When you take out a VA loan, the VA guarantees that it will pay the lender up to a certain amount if you default. The may provide amount varies by the size of the loan, but for most loans it is 25 percent of the loan amount, up to a maximum of around $636,000 (this maximum changes each year). Because the lender's risk is lower, they can offer you better terms than they would on a conventional loan.

The may provide does not mean the VA will pay your mortgage for you if you fall behind. It means the VA will reimburse the lender for losses if the home is foreclosed and sold for less than you owe. You are still responsible for making every payment on time. If you default, the VA's may provide protects the lender, not you — and a foreclosure will damage your credit and you may owe the VA money.

The funding fee and what it covers

Most VA loans come with a one-time funding fee that goes to the VA, not to your lender. The fee is usually 2 to 3 percent of the loan amount for first-time users, depending on whether you are putting down any money of your own. If you are buying with zero down, the fee is typically 2.3 percent. If you put down 5 percent or more, the fee drops to 1.63 percent. The fee is lower for subsequent uses of your benefit.

You can pay the funding fee upfront in cash at closing, or you can roll it into your loan amount and pay it over time as part of your monthly mortgage payment. Some borrowers are exempt from the funding fee — this includes Purple Heart recipients, service members rated as totally disabled by the VA, and surviving spouses of service members who died in service or from a service-connected disability.

Who is may be able to access for a VA home loan

To be may be able to access, you must have served on active duty in the Army, Navy, Air Force, Marines, or Coast Guard, or in the reserves or National Guard. The length of service required depends on when you served. Generally, service members who served on active duty for at least 90 days during wartime, or 181 days during peacetime, are may be able to access. Reservists and National Guard members typically need six years of service.

Surviving spouses of service members who died in service or from a service-connected disability may also be may be able to access. The VA will tell you whether you may have access to when you request your Certificate of may be able to access. If you are still on active duty, you can request the certificate through your command or directly through the VA.

Getting your Certificate of may be able to access

Before a lender will consider your VA loan process, you need a Certificate of may be able to access from the VA. You can request it online through VA.gov, by mail, or through your lender — most lenders can request it on your behalf as part of the process process. Online requests usually take a few days; mail requests can take two to four weeks.

You will need your Social Security number and date of birth to request the certificate online. If you served before 1974, you may need to provide your discharge papers (DD Form 214) as proof of service. Once the VA issues the certificate, it does not expire — you can use it whenever you are ready to buy.

Using your VA loan benefit more than once

You can use your VA home loan benefit more than once during your lifetime. After you sell a home you bought with a VA loan and pay off the mortgage, your may be able to access is restored and you can use the benefit again. Some borrowers use it multiple times as they move for work or want to upgrade to a larger home.

If you want to use your benefit again before you have sold your first home, you may be able to restore your may be able to access if you meet certain conditions — usually by paying back the VA may provide amount out of pocket. Your lender can tell you whether restoration is possible in your situation.

VA loans versus conventional loans and other mortgage types

The main advantage of a VA loan is that you can buy a home with no down payment and no mortgage insurance. On a conventional loan, most lenders require 3 to 20 percent down, and if you put down less than 20 percent, you pay PMI on top of your regular mortgage payment. PMI can add $100 to $300 or more to your monthly payment, depending on the loan size.

VA loans also often have lower interest rates than conventional loans because the VA may provide reduces the lender's risk. The trade-off is the funding fee, which is a one-time cost. Over the life of a 30-year loan, the savings from no down payment, no PMI, and a lower rate usually far outweigh the funding fee, but the math depends on your specific situation and how long you plan to stay in the home.

FHA loans (Federal Housing Administration loans) also allow low down payments and are open to borrowers who do not have military service, but they require mortgage insurance for the life of the loan if you put down less than 10 percent. USDA loans are for rural homebuyers and also require no down payment, but you must meet income and property location requirements.

Frequently Asked Questions

Can I use a VA loan to buy a second home or investment property?

No. VA loans are for primary residences only — the home you will live in as your main address. You cannot use the benefit to buy a vacation home, rental property, or investment property. Once you move out of a home you bought with a VA loan, you can no longer use that loan, though you may be able to restore your may be able to access to buy another primary residence.

What if I have bad credit or a foreclosure in my past?

The VA itself does not set a minimum credit score, but individual lenders do. Most VA lenders require a credit score of 620 or higher, though some will work with lower scores. A past foreclosure or bankruptcy does not automatically disqualify you, but lenders will look at how much time has passed and what your payment history looks like since then. Ask multiple lenders — standards vary.

Do I have to use a VA loan if I am may be able to access?

No. If you are may be able to access but prefer to use a conventional loan, FHA loan, or another type of mortgage, you can do that. Some borrowers choose a conventional loan if they are buying in a very competitive market where sellers prefer conventional offers, or if they plan to sell the home quickly and want to avoid the funding fee.

Can my spouse use my VA loan benefit?

Your spouse cannot use your benefit directly, but if your spouse is also a veteran or service member, they have their own may be able to access and can use their own VA loan benefit. If your spouse is not a veteran, they can be a co-borrower on your VA loan, but the loan is based on your may be able to access and your income.

What happens if I want to refinance my VA loan later?

You can refinance a VA loan into another VA loan (called a VA-to-VA refinance) or into a conventional loan. A VA streamline refinance (called an IRRRL, or Interest Rate Reduction Refinance Loan) has a simpler process and lower costs than refinancing into a conventional loan. You can use this option if you already have a VA loan and want to lower your interest rate.