VA Loans

VA Loan Benefits

The VA has guaranteed more than 28 million loans since 1944, when the home loan program began as part of the original GI Bill of Rights. VA loans work much like any other home loan but come with significant benefits meant to make homeownership easier and more affordable for Veterans and service members.

Here's a look at a handful of the biggest benefits of VA loans:

0% Down Payment

Being able to buy a home without a down payment is the signature benefit of VA loans. This huge advantage has been part of the loan program since day one. Qualified Veterans can purchase without making a down payment, no matter how much home they're buying.

Most other loan types will require a down payment, often at least 3% of the loan or more. Saving that kind of lump sum can take years for many Veterans and military families. VA buyers with plenty of cash for a down payment can also choose to invest that money elsewhere.

VA loans were created to expand access to homeownership, and one of the ways they're still fulfilling that mission today is through more flexible and forgiving credit underwriting requirements.

Credit score minimums vary by lender, but VA loans often have lower score requirements than other loan types. At Veterans United, we typically look for a minimum FICO score of 620. VA loans don't have a hard cutoff for debt-to-income ratio, and they typically have shorter waiting periods following negative credit events like bankruptcy or foreclosure.

With conventional loans, buyers who can't make a 20% down payment usually have to pay for private mortgage insurance (PMI), an additional monthly cost that cuts into their buying power. FHA loans have both an upfront and a monthly form of mortgage insurance.

VA loans don't require a down payment or mortgage insurance, which saves Veterans and helps boost their homebuying budget.

VA Loan Eligibility

Veterans and service members must meet basic time-in-service and character of service requirements to be eligible for a VA home loan. Some surviving spouses also have VA loan eligibility.

Active duty service members, Veterans and those serving in the National Guard and Reserves can all be eligible, along with select other groups.

Generally, you can be eligible for a VA loan if you served:

  • 90 consecutive days on active duty (wartime)
  • 181 consecutive days on active duty (peacetime)
  • 6 years in the Guard or Reserve, or 90 days under Title 32 orders (at least 30 of those days must be served consecutively)

Lenders like Veterans United can help obtain your Certificate of Eligibility (COE), a formal document issued by the VA that confirms you meet the guidelines. Veterans don't need to get this document before starting the home loan process.

Veterans need to meet both VA and lender guidelines related to things like credit score, debt-to-income ratio and more. Our next section of the guide explains VA loan eligibility requirements and typical lender lender guidelines in detail.

Understanding all of your mortgage options is key to making the best financial decision possible. Just because you’re a Veteran doesn’t mean a VA loan is automatically the right fit. But for many Veterans and service members, this becomes the most financially advantageous path to homeownership.

A Veterans United loan specialist can run the numbers and help you evaluate all your mortgage options.