Quick Answer
A VA-backed loan is made by a private lender and partly guaranteed by the Department of Veterans Affairs. Many need no down payment as long as the price isn't above the appraised value, and there's no private mortgage insurance. Most borrowers pay a one-time funding fee. You start by getting a Certificate of Eligibility.
Who is eligible?
Eligibility depends on your service. For example, current service members generally qualify after 90 continuous days of active duty. Veterans who served after August 2, 1990, generally need 24 continuous months, or the full period they were called to active duty if that was at least 90 days. National Guard and Reserve members and some surviving spouses can qualify too. You also need to meet VA's and your lender's credit, income and occupancy rules.
Do you need a down payment?
Often not. VA says there's no down payment as long as the sale price isn't higher than the home's appraised value, and nearly 90 percent of VA-backed loans are made with none.
Is there mortgage insurance?
No. VA loans don't need private mortgage insurance or mortgage insurance premiums. Instead, most borrowers pay a one-time VA funding fee. Some don't, including those who receive VA compensation for a service-connected disability. Use our VA funding fee calculator to see the amount from VA's current table.
Who makes the loan?
For most VA loans, a private bank or mortgage company is the lender. VA guarantees part of the loan, promising to repay the lender a share if you default. That guarantee is why lenders can offer these terms.
How do you get started?
Request your Certificate of Eligibility, or COE. It confirms to your lender that you meet the service requirements, and VA calls it the first step in getting a VA-backed home loan.
Common Questions
Is there a limit on how much I can borrow with a VA loan?
If you have full entitlement, VA sets no loan limit, as long as you can afford the loan and the appraisal supports the price. Your lender still decides whether to make the loan.
Does VA offer reverse mortgages?
No. The CFPB warns that VA does not offer reverse mortgage loans. Be wary of ads that suggest otherwise.
Sources
This guide is general information, not advice about your situation.