VA Home Loan Guide

A VA home loan is a mortgage option backed by the U.S. Department of Veterans Affairs. The VA does not lend the money directly (with one exception) — instead, it guarantees a portion of the loan, which allows private lenders to offer significantly better terms than conventional mortgages.

Key advantages include:

• No down payment — purchase a home with zero money down in most cases
• No private mortgage insurance (PMI) — unlike conventional loans that require PMI for less than 20% down
• Competitive interest rates — typically lower than conventional or FHA loans
• Limited closing costs — the VA restricts what lenders can charge veterans
• No prepayment penalty — pay off your loan early without extra fees
• Easier qualifying standards — more flexible credit and income requirements

VA home loan eligibility is based on your service history, duty status, and character of discharge. General requirements:

• Active duty: 90 consecutive days during wartime, or 181 continuous days during peacetime
• Post-9/11 service: 90 consecutive days of active service (any of which occurred after September 10, 2001)
• National Guard / Reserve: 6 or more years in the Selected Reserve or National Guard, OR called to active duty for at least 90 days under Title 10
• Current service members: 90 continuous days on active duty (wartime) or 181 days (peacetime)
• Surviving spouses: Un-remarried spouse of a veteran who died in service or from a service-connected disability. Spouses of POW/MIA service members may also qualify.

You must have been discharged under conditions other than dishonorable. If you received a less-than-honorable discharge, you can request a character-of-discharge determination from the VA.

The Certificate of Eligibility is a document from the VA that confirms you meet the service requirements for a VA home loan. Your lender needs it before processing your loan.

How to Get Your COE

• Online (fastest): Apply through VA.gov — many applicants get an instant result
• Through your lender: Most VA-approved lenders can pull your COE electronically using the VA's Web LGY system
• By mail: Complete VA Form 26-1880 and mail it to the Atlanta Regional Loan Center

Documents You May Need

• DD-214 (for veterans)
• Statement of Service signed by your commander or personnel office (for active duty)
• NGB Form 22 or discharge papers (for National Guard)
• Annual retirement points statement (for Selected Reserve)
• Death certificate and marriage license (for surviving spouses)

Your entitlement is the amount the VA guarantees on your loan. Understanding entitlement matters most if you plan to have more than one VA loan at a time or have a prior VA loan default.

Basic Entitlement

The VA guarantees up to $36,000 in basic entitlement. This is enough to cover a loan of up to $144,000 without a down payment (lenders typically require the guarantee to cover 25% of the loan).

Bonus (Tier 2) Entitlement

For loan amounts above $144,000, the VA provides additional "bonus" entitlement. This bonus entitlement is tied to the conforming loan limit in your county.

After the Blue Water Navy Act (2020)

As of January 1, 2020, veterans with full entitlement have no loan limit — you can borrow as much as a lender will approve with zero down payment. County loan limits only apply if you have reduced (partial) entitlement, such as when you already have an active VA loan or had a VA loan default.

The VA funding fee is a one-time fee paid at closing (or rolled into the loan) that helps sustain the VA loan program. The amount depends on your service type, down payment, and whether it's your first VA loan.

Current Funding Fee Rates — Purchase Loans

Note: National Guard and Reserve members pay the same funding fee rates as active-duty veterans. A previous surcharge was eliminated in 2020 by the Blue Water Navy Vietnam Veterans Act.

Who Is Exempt from the Funding Fee

• Veterans with any service-connected disability rating (including 0%) — use our compensation rates page to check your rating level
• Veterans eligible to receive VA disability compensation but receiving retirement or active duty pay instead
• Surviving spouses entitled to DIC (Dependency and Indemnity Compensation)
• Active duty service members and veterans who received a Purple Heart

If you paid the funding fee and later received a retroactive disability rating, you can request a refund from the VA.

• Purchase Loan: The standard VA loan for buying a primary residence. No down payment, no PMI, competitive rates. Eligible property types include single-family homes, VA-approved condos, multi-unit properties (up to 4 units if you live in one), and manufactured homes on permanent foundations.
• Cash-Out Refinance: Refinance an existing mortgage (VA or non-VA) and take cash out of your home's equity. The only VA program that lets you convert a non-VA loan into a VA loan. Up to 100% loan-to-value.
  Read our full Cash-Out Refinance guide →
• Interest Rate Reduction Refinance Loan (IRRRL): Also called a "streamline refinance." Refinances an existing VA loan to a lower interest rate with minimal paperwork. No appraisal or credit underwriting required in many cases.
  Read our full IRRRL guide →
• Construction Loan: Finance building a new home from the ground up using your VA benefit. The VA launched a standardized single-close construction loan program in August 2025 — one closing, one application, $0 down, auto-converts to permanent VA mortgage.
  Read our full Construction Loan guide →
• Native American Direct Loan (NADL): The one exception where the VA lends directly. Available to Native American veterans (or veterans married to a Native American) for purchasing, building, or improving a home on Federal Trust Land.
  Read our full NADL guide →
• Loan Assumptions: All VA loans made after March 1, 1988 are assumable — a buyer can take over your existing VA mortgage at your original interest rate. With 74% of VA homeowners locked in below 5%, assumed loans can save buyers nearly $1,000/month compared to current market rates.
  Read our full Loan Assumptions guide →
• Renovation Loan: Finance both the purchase of a home AND the cost of repairs into a single VA loan. Ideal for buying fixer-uppers that don't currently meet VA Minimum Property Requirements — the renovation plan brings them into compliance. Authorized under 38 USC 3710(a)(4).
  Read our full VA Renovation Loan guide →
• Vendee Loan: A VA seller-financing option for purchasing VA-owned foreclosure (REO) properties. Available to anyone — veterans and non-veterans alike, owner-occupants and investors. Properties are sold "as-is" with no MPR requirements. Browse listings at VRM Properties.
• Adapted Housing Grants: Not a loan, but a grant for veterans with certain service-connected disabilities to modify or build an adapted home. Includes the Specially Adapted Housing (SAH) and Special Housing Adaptation (SHA) grants (see details below).

1. Get your Certificate of Eligibility (COE): Apply online through VA.gov, have your lender pull it, or mail VA Form 26-1880. This confirms your eligibility.
2. Find a VA-approved lender: Not all lenders offer VA loans. Shop around and compare rates — even small rate differences save thousands over the life of a loan.
3. Get pre-approved: The lender will review your income, credit, debts, and COE to determine how much you can borrow. A pre-approval letter strengthens your offer.
4. Find a home: Work with a real estate agent (ideally one experienced with VA transactions). The home must be your primary residence.
5. VA appraisal: Once you're under contract, the lender orders a VA appraisal. A VA-assigned appraiser determines the home's market value and checks it meets Minimum Property Requirements (MPRs).
6. Underwriting and closing: The lender finalizes the loan. At closing you'll sign documents and pay any closing costs or the VA funding fee (unless exempt). You get the keys.

Every VA purchase loan requires a VA appraisal. This is different from a home inspection — the appraiser determines the home's fair market value and confirms the property meets the VA's Minimum Property Requirements (MPRs).

What the VA Appraiser Checks

• Adequate roof, foundation, and structural integrity
• Working mechanical systems (heating, electrical, plumbing)
• Safe and sanitary water and sewage systems
• No lead-based paint hazards (for homes built before 1978)
• Adequate access from a public or private road
• No termite or pest damage that affects structural integrity
• Sufficient living space for the intended use

The Tidewater Process

If the VA appraiser believes the home's value will come in below the purchase price, they invoke the "Tidewater" process before issuing a final value. This gives the lender (and the veteran's agent) 48 hours to submit additional comparable sales or other data that may support the contract price. If the appraisal still comes in low, the veteran can renegotiate, make up the difference in cash, or walk away.

• You can use your VA loan benefit more than once. Pay off or sell the home and restore your entitlement. You can even have multiple VA loans at the same time if you have enough remaining entitlement.
• It is not just for first-time homebuyers. There is no limit on the number of times you can use a VA loan.
• Sellers can pay your closing costs. The VA allows sellers to pay all of the veteran's loan-related closing costs and up to 4% of the loan amount in concessions (covering things like prepaid taxes and insurance).
• VA loans are not "slower" than conventional loans. With an experienced lender, VA loans close on a similar timeline to other loan types.
• You can use a VA loan for condos and manufactured homes — as long as the property is VA-approved and meets MPRs.
• Refinancing does not require a new COE. For an IRRRL (streamline refinance), your existing VA loan serves as proof of eligibility.
• Your entitlement can be restored if you sell the home and pay off the loan, or if a qualified veteran assumes your loan.

The VA limits what lenders can charge veterans. The total lender origination fee is capped at 1% of the loan amount, which must cover all processing, underwriting, and administrative costs. If the lender charges the flat 1%, they cannot also charge separate fees for those items.

Fees Veterans CAN Pay

• VA funding fee (can be financed into the loan)
• Origination fee (up to 1% of loan amount)
• Discount points (to buy down interest rate)
• Credit report, VA appraisal, recording fees, title insurance, survey, hazard insurance, prepaid items (taxes, insurance, per-diem interest)

Fees Veterans CANNOT Pay

• Termite/pest inspection — Note: As of June 2022 (VA Circular 26-22-11), the VA lifted this restriction. Veterans may now pay for pest inspections on purchase loans.
• Real estate agent commissions or buyer-broker fees
• Settlement/escrow fees, notary fees, rate lock fees, loan application fees
• Separate processing, underwriting, or document preparation fees (must be included in the 1% cap)

Seller Concessions

Sellers can pay all of the veteran's legitimate closing costs with no percentage limit. On top of that, sellers can contribute up to 4% of the home's value in concessions (paying buyer debts, funding fee on buyer's behalf, temporary rate buydowns, etc.).

VA loans can finance manufactured homes, but they must meet specific requirements beyond what is needed for a standard site-built home:

• Built after June 15, 1976 — when HUD building standards for manufactured housing took effect
• Permanent foundation required — the home must be permanently affixed with wheels, axles, and towing equipment removed. Must comply with the HUD Permanent Foundation Guide for Manufactured Housing (PFGMH)
• HUD certification — must have both a HUD Label (exterior metal plate) and a Data Plate (interior sticker) proving it was built to federal standards
• Classified as real property — must be titled and taxed as real estate under state law, not personal property
• Minimum 700 sq ft of interior floor space
• Lot financing — VA can finance both the home and the land in a single loan (home and lot must be titled together)

Funding fee: Manufactured homes not permanently affixed pay a flat 1% funding fee. Homes on permanent foundations use standard VA purchase loan rates.

A VA jumbo loan is any loan that exceeds the conforming loan limit for a county. Since the Blue Water Navy Act (2020), the rules depend entirely on your entitlement status:

• Full entitlement: No VA-imposed loan limit — buy a $500,000, $1 million, or $2 million home with $0 down, as long as you qualify with the lender
• Partial entitlement: County loan limits apply. The 2026 baseline is $832,750 (high-cost areas up to $1,249,125). You may need a down payment of 25% of the amount exceeding your remaining entitlement coverage

You have partial entitlement if you currently have an active VA loan or previously used entitlement that hasn't been restored. Even with a jumbo loan, VA loans never require PMI.

The EEM is not a standalone loan — it's an add-on to a VA purchase loan, IRRRL, or cash-out refinance that lets you finance energy-efficient improvements into your mortgage.

Qualifying improvements include solar panels, HVAC upgrades, insulation, energy-efficient windows and doors, water heaters, and weather-stripping. Improvements must be completed within 6 months of closing.

A bankruptcy or foreclosure does not permanently disqualify you from a VA loan. The waiting periods are shorter than for conventional loans:

Entitlement after foreclosure: If VA paid a claim on a foreclosed VA loan, your entitlement is reduced by that amount. It is not automatically restored — you must repay VA's loss in full to get full entitlement back. However, remaining second-tier entitlement may still allow you to purchase again with a reduced maximum.

After the waiting period, demonstrate re-established credit, stable employment, and a manageable debt-to-income ratio. Be prepared to provide a written explanation of the circumstances.

Surviving spouses of veterans may qualify for the same VA loan benefits — $0 down, no PMI, competitive rates — and are exempt from the VA funding fee, which can save thousands of dollars.

Eligible Surviving Spouses

• Un-remarried spouse of a veteran who died while on active duty
• Un-remarried spouse of a veteran who died from a service-connected disability
• Spouse of a service member who is MIA or a POW for 90+ days
• Spouse of a totally disabled veteran (100% P&T) who subsequently died, even if the death was unrelated to the disability

Remarriage Rules

Remarriage does not automatically disqualify you. If you remarried on or after December 16, 2003 and were age 57 or older at the time, you retain eligibility. If a subsequent marriage ends (through death, divorce, or annulment), eligibility is restored regardless of age.

How to Apply

If receiving DIC: Apply for a COE using VA Form 26-1817. If not receiving DIC: File VA Form 21P-534EZ first to establish service-connection, then apply for COE.

The VA offers housing grants to veterans with certain service-connected disabilities. These grants help adapt an existing home, build a new adapted home, or purchase an already-adapted home.

Specially Adapted Housing (SAH) Grant

Maximum grant amount: $126,526 (FY 2026, adjusted annually). Available up to 6 times, with the total not to exceed the maximum. For veterans with qualifying disabilities including:

• Loss or loss of use of both legs, or both arms, or one leg and one arm
• Blindness in both eyes (with certain criteria)
• Certain severe burns
• Loss or loss of use of a lower extremity after September 11, 2001, that prevents ambulation without assistive devices

Special Housing Adaptation (SHA) Grant

Maximum grant amount: $25,350 (FY2026, adjusted annually). Available up to 6 times, with the total not to exceed the maximum. For veterans with qualifying disabilities including:

• Blindness in both eyes (with light perception only)
• Loss or loss of use of both hands
• Certain severe burns
• Certain severe respiratory injuries

Apply through your VA regional office or online at VA.gov using VA Form 26-4555. The VA also offers Temporary Residence Adaptation (TRA) grants if you are living temporarily in a family member's home.

Home Improvements & Structural Alterations (HISA) Grant

Separate from SAH/SHA, the HISA grant helps veterans make medically necessary home modifications — ramps, roll-in showers, widened doorways, grab bars — administered through VA Prosthetics, not the Home Loan division.

• Service-connected disability: Up to $6,800 lifetime
• Non-service-connected disability: Up to $2,000 lifetime
• Can be received in addition to SAH or SHA grants
• No minimum disability rating required

Apply for SAH/SHA Grants  |  HISA Grant Details

If you are struggling to make your VA loan payments, the VA has programs to help you avoid foreclosure. Contact your loan servicer or the VA as early as possible — the sooner you reach out, the more options are available. Our Financial Readiness page covers budgeting and debt management strategies.

Options available:

• Repayment plan — Your servicer adds a portion of the missed payments to your regular monthly payment until you are caught up
• Special forbearance — Temporary suspension or reduction of payments during a financial hardship, with an agreement to repay later
• Loan modification — Permanently changes the terms of your loan (interest rate, term length, or adding missed payments to the balance) to make payments affordable
• VA Refunding program — In certain cases, the VA can buy your loan from the servicer and restructure it on more favorable terms
• Private sale — Sell the home before foreclosure, even if the sale price is less than what you owe (short sale requires servicer approval)
• Deed in lieu of foreclosure — Transfer the property to the servicer to avoid formal foreclosure proceedings (last resort, but less damaging to credit than foreclosure)

VA Loan Servicing: Call 877-827-3702 to speak with a VA loan technician who can intervene on your behalf with your servicer. The VA assigns a technician to every loan that becomes 61+ days delinquent to help explore alternatives to foreclosure.

Most states offer property tax exemptions for disabled veterans, and this is one of the most valuable but overlooked benefits. For veterans rated 100% permanent and total (P&T), many states offer a full property tax exemption — which can save thousands of dollars per year.

Common patterns across states:

• 100% P&T disability: Full property tax exemption in 22+ states (including Texas, Florida, Virginia, Michigan, Illinois, and others)
• Partial disability ratings: Many states offer partial exemptions scaled to disability percentage, or fixed dollar amounts off assessed value
• Surviving spouses: 30+ states extend some form of property tax exemption to surviving spouses of disabled or deceased veterans
• Application required: Exemptions are not automatic — you must apply through your county tax assessor's office with proof of disability rating and property ownership

Rules vary dramatically by state. Check your state benefits page for the specific exemptions and application process in your state.