VA Loan
A VA loan offers zero-down mortgages to eligible veterans and service members. Learn benefits, funding fees, and eligibility.
Definition
A VA loan is a mortgage program offered by private lenders and guaranteed by the U.S. Department of Veterans Affairs (VA). It provides eligible veterans, active-duty service members, and certain surviving spouses with zero‑down payment financing, competitive interest rates, and no private mortgage insurance requirement. Borrowers pay a one‑time funding fee (which may be financed) and must meet service and credit qualifications. VA loans can be used to purchase, build, or refinance a primary residence. The program helps veterans achieve homeownership and build wealth while minimizing upfront costs.
Why It Matters
Zero down is the headline, but the mechanics are where the value sits. There is no monthly mortgage insurance, which usually beats a 5 percent down conventional payment outright, and the VA escape clause lets a buyer walk without losing earnest money if the appraisal comes in under the contract price. Veterans with a compensable service connected disability rating pay no funding fee at all, which is thousands of dollars.
Examples
A veteran buying at $600,000 on first use with full entitlement owes a 2.15 percent funding fee of $12,900, financed into the loan, or nothing at all with a 30 percent disability rating.
A VA appraiser flags peeling paint on a 1948 house as a minimum property requirement issue, and the seller has to repaint the eaves before the loan can fund.
A veteran who still owns a home in San Diego with a VA loan on it uses remaining entitlement to buy in Tacoma without selling the first property.
Tips
Pull your Certificate of Eligibility through your lender or the VA portal at the start; it takes minutes electronically and weeks if it has to go through paper channels.
Handle minimum property requirement items like chipped paint, exposed wiring and a roof with under three years of life before the appraiser visits, not after the report lands.
Competing against cash works better if you lead with a fully underwritten preapproval and a tight closing date, since the escape clause is required by the VA and is not yours to waive.
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