Mortgage & Home Loans

What is VA Loan?

A VA loan is a zero-down-payment mortgage for eligible military members, veterans, and surviving spouses. It's guaranteed by the Department of Veterans Affairs and designed to help military families buy, build, or improve a home.

VA loans require 0% down and have no monthly PMI. Under the Blue Water Navy Vietnam Veterans Act, veterans with full entitlement face no county-level loan limits—they can buy above conforming limits with no down payment.

Instead of PMI, there's a one-time VA Funding Fee paid at closing (which can be rolled into the loan). The fee varies based on your down payment and whether you've used the benefit before.

Quick Facts

Guarantor AgencyUS Department of Veterans Affairs

Down Payment Requirement0% down payment required

Mortgage InsuranceNo monthly PMI required

Funding FeeOne-time fee at closing (can be financed)

PRACTICAL EXAMPLE

You're a qualifying veteran buying a $450,000 home with a VA loan. Zero down. You finance the full amount plus a 2.15% VA funding fee ($9,675) added to the balance. No monthly PMI — that's the trade-off you get for the one-time fee.

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RELATED TERMS

Learn More Key Concepts

MortgageA loan secured by real estate that you pay back in regular installments over a set term.

Down PaymentThe cash you pay upfront when buying a home, which becomes your initial equity in the property.

Conventional LoanA mortgage loan that is not backed or insured by a government agency, typically conforming to Fannie Mae or Freddie Mac standards.

PMIInsurance required on conventional loans when the down payment is less than 20%, protecting the lender against borrower default.

Closing CostsThe fees and expenses paid at the end of a real estate transaction to finalize the mortgage and transfer property ownership.

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