VA home loans are insured by the Department of Veterans Affairs and available to qualified active duty service members, veterans and surviving spouses. To qualify, obtain your Certificate of Eligibility before meeting lender’s criteria.

Borrowers must show they have sufficient income, credit score, and reserve funds before applying for VA loan proceeds. Furthermore, loan proceeds cannot be used for investment properties or vacation homes.


As one of the main attractions of VA home loans is that they do not require private mortgage insurance (PMI) premiums, which can add up quickly over time – particularly for service members and veterans already facing financial strain. Thus, one of the greatest attractions of this type of mortgage should not be underestimated when applying.

Conventional home buyers who cannot make a 20% down payment typically must purchase PMI to protect the lender in case the borrower defaults, an expensive and burdensome requirement which makes conventional financing harder for some borrowers. VA loans provide relief by being insured through Department of Veteran Affairs; as a result they do not necessitate mortgage insurance coverage for lenders and thus do not necessitate PMI.

However, the VA does impose a funding fee, which must either be included with loan amounts or paid upfront. Eligible veterans can request to waive this fee; permanently disabled service members, widowed spouses of deceased service members and those receiving compensation due to service-related medical conditions all can qualify for such relief.

Another way to reduce PMI payments is to select a smaller home, which will enable you to build equity faster and qualify for lower interest rates than with larger mortgages, thus further cutting loan costs.

If you are considering a VA purchase or refinance mortgage loan, speaking to an experienced loan specialist about eligibility requirements and rates can provide valuable insights. In addition, using the interactive VA mortgage calculator allows for better calculation of approximate loan amounts and closing costs.

No Limits

VA home loans are tailored specifically for veterans to help them compete in the housing market, with more flexible requirements regarding credit, down payment and debt-to-income ratio than conventional mortgages. There are still some important requirements potential borrowers must fulfill, however; qualifying for service, meeting income asset reserve standards as well as possessing an acceptable credit history should all be fulfilled before becoming eligible for this type of loan can begin.

Loan limits on VA purchase loans are set by lenders; however, in cases where borrowers with full entitlement have never taken out one before and have never used this particular loan product before (i.e. “no limits”) there may not be a maximum borrowing amount limit set. This process is known as “no limits.”

Those who have previously utilized their VA eligibility will find their loan size determined based on previous use of benefits and the remaining entitlement they possess. Local loan limit factors (typically average conventional loan limits for high-cost counties) will also be taken into consideration by lenders.

Dependent upon the lender, some loans require that borrowers maintain sufficient cash reserves to cover any payments above what is calculated as the monthly debt-to-income ratio (DTI). Furthermore, certain lenders may impose requirements regarding minimum credit score and DTI in order to be approved for loans.

Navy Federal Credit Union (NMLS ID 551907) stands out as a premier VA home loan lender due to their fast pre-approval process and no PMI costs, in addition to offering various loan products including 203k (home renovation) mortgages. Guild Mortgage (NMLS ID 3274), another top VA home lender, also offers competitive rates with diverse products including home renovation loans 203k mortgages as well as online application processes and digital assets verification tools that speed up loan applications and approval processes.

No Closing Costs

As opposed to conventional loans, VA loans don’t require upfront closing costs like origination fees and mortgage points from borrowers; this does not apply to real estate agent commissions however; homebuyers typically cover these themselves or ask the seller to reimburse them; additionally any extra costs such as radon testing, termite inspections, or title insurance can be negotiated separately with seller(s).

The VA does not mandate PMI on new purchases, further lowering closing costs. Furthermore, its liberal lending policies enable veterans to qualify for mortgages that would otherwise be denied; however, lenders may require veterans to show reserves equal to two months’ mortgage payments as proof they can afford their monthly payment obligations.

Sometimes lenders can assist veterans with closing costs by rolling them into their mortgage loan – known as lender credits – making monthly payments lower but increasing overall costs over the loan’s lifecycle.

The VA allows its borrowers to roll funding fees into their loan, which can help avoid paying these upfront and build equity faster. It is important to remember, though, that adding these expenses into your mortgage loan will increase both its total amount owed as well as monthly mortgage payments; additionally, any extra funds added will incur interest charges which should be saved up for in advance instead.

No Down Payment Requirement

One major advantage of VA home loans is their lack of down payment requirements, making homeownership more accessible for buyers with lower credit scores who might otherwise not qualify for conventional mortgages. It should be noted however, that there may be exceptions; those with existing unpaid-off VA loans, borrowing beyond conforming loan limits or buying with non-VA eligible spouses may need to make down payments; your lender can explain any specific down payment requirements you need to fulfill for a VA home loan purchase.

No matter if it is your first home purchase or not, making a down payment can reduce the funding fee at closing or upfront fees charged by VA loans. The VA recognizes it as self-sustaining when borrowers make at least part of their purchase in cash.

Down payments offer additional advantages to borrowers by instantly building equity in their property and showing that a borrower is committed to it, which increases chances of VA loan approval if other financial factors aren’t as solid.

Consider that VA home loans can only be used to buy one-to-four family properties that will serve as your primary residence, meeting VA Minimum Property Requirements (MPRs), which ensure a dwelling meets safety, soundness and sanitation requirements. Although certain lenders provide VA financing for condominiums and manufactured homes, not all do. As such, it is wise to discuss with any prospective lenders their lending policies and eligibility criteria prior to starting househunting.

No Credit Check

VA loans provide an ideal option for veterans or active duty service members who have difficulty qualifying for traditional mortgage loans, with less stringent requirements such as lower credit score and debt-to-income ratio requirements, no private mortgage insurance fees required, etc.

However, you must still meet a minimum credit score and other lender requirements in order to be approved for a VA loan. Most lenders prefer seeing at least 620 as the threshold; if this threshold falls short there may still be ways for approval; otherwise.

As an example, you can try to raise your credit score by disputing any errors on your report and working toward having them deleted; by paying down credit card balances to decrease debt utilization ratio; by making sure bills are always paid on time; or even becoming an authorized user on another person’s credit card account – although doing this carries risks such as being held liable if payments from either party go missed.

Saving for a down payment on your home purchase can also help your credit score by showing lenders that you are capable of making mortgage payments on time and avoiding high closing costs, like VA funding fees which range from 1.4% to 3.6% of loan amount.