VA Home Loans Explained: What Every Veteran Should Know
If you’re Active Duty, a Veteran, or a surviving spouse, the VA loan isn’t just another mortgage option — it’s a hard-earned benefit.
We’ve helped a lot of military families use this program the right way, and when it’s structured correctly, it can be one of the strongest home financing tools out there.
Let’s break it down clearly.
A VA loan is a mortgage backed by the U.S. Department of Veterans Affairs. That backing means the VA guarantees part of the loan, which allows lenders to offer favorable terms.
Important distinction: the VA generally does not lend the money. Private lenders issue the loan — the VA provides the guarantee.
Here’s what often makes the program stand out:
VA loans are intended primarily for primary residences, and eligible property types commonly include single-family homes, certain VA-approved condos, and some manufactured or modular homes.
Eligibility is verified through a Certificate of Eligibility (COE), and you must also meet lender credit and income requirements.
In simple terms:
The VA confirms you’ve earned the benefit.
The lender confirms the loan makes financial sense.
The VA funding fee is a one-time fee that helps sustain the program for future veterans.
It is typically calculated as a percentage of the loan amount and varies based on:
Most borrowers can finance the funding fee into the loan instead of paying it out of pocket.
Some borrowers are exempt, including certain veterans with service-connected disabilities and some eligible surviving spouses.
This funding fee is separate from standard closing costs like appraisal, title, and lender fees.
Your COE includes your entitlement, which is the amount the VA guarantees to the lender.
If you have full entitlement available, there is no VA-set maximum loan amount. However, you must still qualify based on income, debt-to-income ratios, and lender guidelines.
If you’ve used your entitlement before and haven’t restored it, your maximum borrowing amount may be limited based on remaining entitlement and county loan limits.
Another important piece: the VA looks at residual income — the amount of money you have left each month after paying major debts. This is one reason VA underwriting can be more flexible than conventional financing.
Yes — and this is one of the most overlooked advantages of a VA loan.
Most VA loans are assumable, which means a future buyer can take over the seller’s existing loan terms — including the interest rate and remaining balance — if the lender approves the buyer’s credit and income.
If a veteran purchased a home at a 3% rate and current market rates are significantly higher, a qualified buyer may be able to assume that lower rate instead of financing at today’s rate.
That can be a major competitive advantage.
Example:
If the home sells for $600,000 and the remaining VA loan balance is $450,000, the buyer must bring or finance the $150,000 gap (plus closing costs).
No. A non-veteran can assume a VA loan if approved.
However, this is where strategy matters.
If a non-veteran assumes the loan, the original veteran’s entitlement typically remains tied to that loan until it is paid off. That can limit the seller’s ability to fully reuse their VA benefit.
If another eligible veteran assumes the loan and substitutes their entitlement, the original borrower may be able to restore theirs.
There is also typically a 0.5% assumption funding fee unless the buyer qualifies for an exemption.
Assumptions can be incredibly valuable — but they require careful structuring and coordination.
Yes.
There are refinance options designed to:
Refinance guidelines differ from purchase loans, so it’s important to evaluate timing, costs, and long-term strategy before making a move.
The VA loan is one of the most valuable homeownership benefits available — and it becomes even more powerful when you understand that it can be assumable.
In the right market, an assumable VA loan can:
But like anything worth doing, it has to be structured correctly — especially when entitlement and release of liability are involved.
If you’re thinking about using your VA benefit — or selling a home with a VA loan in place — let’s run the numbers and map out the smartest route forward. No guesswork. No surprises at the closing table.
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