Veterans Affairs

As a benefit of your service, the Department of Veterans Affairs provides special resources to help military members and veterans purchase a home with little to no down payment. VA Loans offer flexible choices, including both Fixed Rate and Adjustable Rate mortgages.

VA loans allow buyers to finance 100% of the home's purchase price, meaning no down payment is required. However, buyers must still qualify for the loan, which means lenders will assess their credit and ability to repay the mortgage. If you're in a challenging financial situation, a lender may require you to reduce debt or save additional funds before approving the loan.

You may also need to cover closing costs, which can include title recording fees or legal costs for preparing paperwork. These expenses are negotiable with the seller, so it's important to discuss them with your realtor before making an offer on a home.

The VA Loan process

A VA loan functions similarly to most other home purchases, where the buyer submits a written offer with specific terms (such as price, closing cost assistance, and contingencies) and then goes through an approval process with a lender. The main difference with a VA loan is that the Department of Veterans Affairs mandates that all homes purchased through this program meet certain habitability standards. They will send an appraiser and inspector to ensure the home is in good condition and worth the purchase price.

This step can sometimes lead to delays, particularly if repairs are required after the inspection. However, issues with the home don't automatically disqualify the buyer from using a VA loan; they simply need to be addressed before the purchase can proceed. Recently, the VA has introduced a loan option specifically for homes that need limited renovations, allowing buyers to finance repairs as part of their loan.

How VA Loans Work

You will pay more in interest over time. A longer mortgage term means more interest will accumulate. This is how banks and lenders make money—they lend you the funds and collect interest throughout the 15 or 30 years it takes to repay the loan.

Your monthly payment will likely be lower. By extending the loan term over 30 years, your payments are spread out, making them more affordable. If you're working with a tight monthly budget, this could be a better option for you.

How It Works

• Buy your home with as little as a 0% down payment.
• Fixed-rate terms are available in 30-, 25-, 20-, and 15-year options.
• A 5-year adjustable-rate mortgage (ARM) is available.
• Jumbo VA loans available.
• The VA Streamline Refinance offers a reduced funding fee and flexible documentation requirements, available to veterans who are currently in a VA loan.
• No monthly PMI (Private Mortgage Insurance).
• VA loans are regulated by the U.S. Department of Veterans Affairs.
• You can pay off your mortgage at any time without incurring pre-payment penalties.

Have questions? Give us a call! One of our mortgage specialists would be happy to answer all of your questions.

**Funding Team is not affiliated with or acting on behalf of or at the direction of FHA, VA, USDA or the Federal Government.