VA Loan Basics for Veterans

TL;DR: VA loans offer 0% down, no PMI, and competitive rates for eligible veterans, active-duty military, and surviving spouses. The funding fee (2.15-3.3%) is the trade-off.

_Last reviewed: July 2026 · 3 min read_

If you're a veteran, active-duty service member, or eligible surviving spouse considering a home purchase, the honest answer is: VA loans offer benefits no other mortgage matches — 0% down, no monthly mortgage insurance, and competitive rates. The catch is the VA funding fee (2.15-3.3% of loan amount) and eligibility requirements. For qualifying borrowers, it's almost always the best financing option.

Okoniq Property Hub stores loan documents and Certificate of Eligibility so future refinance/2nd-home decisions are easy.

Who's eligible?

VA loan eligibility requires ONE of:

• Active-duty service — 90 continuous days during wartime, 181 days during peacetime
• National Guard/Reserves — 6 years of service
• Veterans — with honorable discharge
• Surviving spouses — of service members who died in service or from service-connected disability

You'll need a Certificate of Eligibility (COE) from the VA — apply through VA.gov or via your lender.

Full eligibility details at VA Home Loans page.

What are the benefits?

Zero down payment: buy with $0 down (most other programs require 3-20%). Get 100% financing on the purchase.

No mortgage insurance: no PMI, no MIP — a huge advantage. Conventional PMI at 5% down costs $150-$400/month; VA saves this entirely.

Competitive interest rates: typically 0.25-0.50% below conventional rates.

Flexible credit: minimum credit score is generally 580-620, though some lenders go lower.

Assumable: future buyers can assume your VA loan at your original rate — huge value if rates rise (see assumable mortgages — what to look for).

What's the VA funding fee?

The IRS/VA equivalent of an origination fee:

• First-time use, no down payment: 2.15% of loan amount
• First-time use, 5%+ down: 1.5%
• First-time use, 10%+ down: 1.25%
• Subsequent use: 3.3% (no down payment)

Can be:

• Financed into loan (most common)
• Paid upfront
• Waived for veterans with service-connected disability

For a $400K loan at 2.15%, that's $8,600 added to the loan balance (or paid at close).

Property requirements

VA loans must be for:

• Primary residence — you must intend to occupy within 60 days
• VA-approved condo — if condo, must be on VA's approved list
• Pass VA appraisal — includes minimum property standards for safety, structural integrity

Investment properties are not eligible.

Loan limits

VA loans have no loan limit for eligible borrowers with full entitlement (as of 2020 change). For borrowers with partial entitlement (previously used VA loan and haven't fully restored), county-specific limits apply.

Comparison table

| Factor | VA Loan | Conventional | |---|---|---| | Down payment | 0% | 3-20% | | Mortgage insurance | None | PMI or MIP | | Rates | 0.25-0.5% below conventional | Baseline | | Funding fee | 2.15-3.3% (financed) | None | | Credit minimum | 580 | 620 typical | | Property use | Primary only | Any | | Assumable | Yes | Generally no |

The refinance option

VA offers two refinance programs:

• IRRRL (Interest Rate Reduction Refinance Loan) — streamline refinance, no appraisal, no income verification
• Cash-out VA refinance — access equity, up to 100% LTV

Both preserve VA benefits.

Save loan documents forever

VA loans have complex documentation (COE, disability rating, service records). Okoniq Property Hub stores everything per property so refinance or future VA loan use is easy. Related: FHA vs conventional for first-time buyers, assumable mortgages — what to look for, and the Mortgage & Money hub. VA-specific guidance at Veterans Benefits Administration.

Frequently asked questions

Can I use VA loan more than once?

Yes — VA benefits are reusable. Can hold two VA loans simultaneously (with sufficient entitlement) or refinance existing VA loan.

Can my spouse use my VA benefit?

Only for eligible surviving spouses of deceased service members. Living veterans cannot transfer benefit to spouse.

Are VA loans assumable by non-veterans?

Yes — anyone can assume a VA loan, but the veteran seller may not have their entitlement restored until buyer refinances into another type of loan.

Not financial advice. VA loan benefits vary by service history and disability status — consult a VA-approved lender + VA regional office. Okoniq Property Hub keeps documents organized. Get started free.

FAQ

How much is the VA funding fee if I have a service-connected disability?

Veterans with a service-connected disability rating receive a complete waiver of the VA funding fee — meaning $0, whether the loan is $200K or $800K.

Can I use a VA loan to buy a second home or vacation property?

No — VA loans are restricted to primary residences you intend to occupy within 60 days. Investment properties, second homes, and vacation homes do not qualify.

What happens to my VA loan eligibility after I sell my home?

Your VA entitlement restores once the loan is paid off, allowing you to use the benefit again. If you sell but the buyer assumes your VA loan, your entitlement remains tied to that loan until the buyer refinances into a non-VA loan.

Do all lenders offer VA loans?

No — not all lenders are VA-approved. You must use a lender authorized by the VA, though most major banks, credit unions, and mortgage companies participate in the VA program.