A VA loan is a mortgage loan in the United States guaranteed by the U.S. Department of Veterans Affairs (VA). This insurance or guarantee is for the lender and does imply a guaranty or security for the customer. The loan may be issued by qualified lenders. The VA loan was designed to offer long-term financing to eligible American veterans or their surviving spouses (provided they do not remarry). The Veterans Benefits Administration (VBA) provides federal guarantees for home loans to qualified applicants. To be eligible for a VA-guaranteed home loan, veterans must have served on active duty in the Army, Navy, Air Force, Coast Guard, or Marines.
The specific service requirements will vary, depending on the time period during which a veteran served. A certificate of eligibility is required to obtain a VA loan, and the loan can be obtained through any mortgage lender who participates in the VA home loan program. The VA-guaranteed home loan is one of very few 0% down payment loans available in the United States (the USDA Rural Housing Loan is another).
US Lender Home Loans is not affiliated or endorsed by the government or the Dept. of Veternans Affairs.
The terms of VA loans are quite generous, compared to other mortgages and even other federal loan programs. Among the benefits:
Are you refinancing? Designed to make refinancing easy for those with a current VA loan, the VA IRRRL can help lower or stabilize your monthly mortgage payments. Lower your current monthly mortgage payment by refinancing to a lower interest rate or change your term from an ARM to a fixed-rate term so your mortgage payment stays the same over the life of your loan. You may be able to avoid certain out-of-pocket costs of refinancing by using a no appraisal option. You can also roll applicable closing costs and fees into the loan. Even if you don’t currently have a VA loan on your home you can still refinance with a VA home loan. Take advantage of lower interest rates and a reduced monthly payment, refinance into a new term, or even finance qualified home improvements with a VA loan.
This powerful home loan is available for eligible borrowers over and over again. You could even have a VA loan on more than one property at a time.
The VA funding fee is paid by the borrower per loan to the Department of Veterans Affairs to fund the program as a whole. The exact amount depends on your loan and situation, but is typically 2.3% of the loan for first time VA loan borrowers with a 0% down payment and 3.6% for those using the VA loan benefit for a second time. If you put 5% or more down on your loan you may be able to lower the funding fee amount. The VA waives the funding fee for certain disabled veterans, Purple Heart recipients, and surviving spouses.
Concerned about paying the funding fee? You can choose to pay the fee as a one-time payment at closing or roll it into your monthly mortgage payment and pay it over the life of your loan.