What Is a VA Loan?

A VA loan is a mortgage loan backed by the U.S. Department of Veterans Affairs (VA). It’s available to eligible veterans, active-duty service members, certain reservists, and surviving spouses. VA loans are issued by private lenders and offer key benefits like no down payment, no private mortgage insurance, and flexible qualification standards.

Originally established in 1944, the VA loan program has helped over 23 million service members and their families purchase or refinance a home.

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Types of VA Loans

1. VA-Backed Purchase Loan

Buy a primary residence with no down payment, no monthly mortgage insurance, and competitive interest rates. Sellers can contribute up to 4% toward your closing costs.

Key Benefits:

• No down payment required

• No PMI (private mortgage insurance)

• Lower closing costs compared to conventional loans

• Available to credit scores as low as 500

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2. Cash-Out Refinance Loan

Refinance your existing mortgage and take cash out of your home equity to use for home improvements, debt consolidation, tuition, or other major expenses.

Highlights:

• Replaces your existing mortgage

• Provides a lump sum of cash at closing

• Can be used even if your current loan is not VA-backed

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3. Interest Rate Reduction Refinance Loan (IRRRL)

Also known as the VA Streamline Refinance, this loan allows current VA borrowers to refinance to a lower rate with minimal paperwork. No appraisal or income verification is typically required.

Eligibility Requirements:

• Must currently have a VA loan

• The loan must be at least 210 days old

• No more than one 30-day late payment in the past 12 months

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Advantages of VA Loans

• No down payment required

• No monthly mortgage insurance (PMI)

• Competitive interest rates

• Lower closing costs (can be included in the loan)

• No prepayment penalties

• Finance up to 100% of the home’s value

• Use your eligibility to purchase multi-unit properties (up to 4 units)

• Flexible qualification standards – including credit scores down to 500

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VA Loan Snapshot

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VA Home Loan Eligibility

To qualify for a VA loan, you must:

• Be an active duty service member, veteran, or reservist (including National Guard)

• Obtain a Certificate of Eligibility (COE) from the VA

• Meet one of the following service requirements:

  • 90 consecutive days of service during wartime

  • 181 days of service during peacetime

  • 6 years in the National Guard or Reserves

• Be an unmarried surviving spouse of a service member who died in the line of duty or from a service-connected disability

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What You’ll Need to Apply

• Certificate of Eligibility (we can help you obtain this)

• Employment history for the past 2 years

• Individual income tax returns from the past 2 years

• Bank statements and asset documentation

• Credit history