VA Home Loans

A VA loan is a mortgage guaranteed by the Department of Veterans Affairs for eligible veterans, active-duty service members, and some surviving spouses. It requires no down payment in most cases, charges no monthly mortgage insurance, and is assumable by a qualified buyer. The VA does not lend the money — approved lenders do, and the VA guarantees part of it.

That guarantee is why the terms are better. It is also why VA loans are underwritten a little differently from everything else, and the differences are where most of the confusion lives.

Who is eligible for a VA loan?

Eligibility comes from service history, not from being a first-time buyer or meeting an income limit. Veterans, active-duty service members, certain National Guard and Reserve members, and some surviving spouses qualify. Service-length requirements vary by era and category.

You prove it with a Certificate of Eligibility (COE). We can usually pull yours during the pre-approval conversation — you do not need to have it in hand before calling.

Eligibility is separate from qualifying. The VA says you may use the benefit; the lender decides whether the loan works. Both have to happen.

Is there really no down payment?

In most cases, yes — and that is the benefit people know about.

The VA does not cap what you can borrow if you have full entitlement, but your loan still has two practical ceilings. Per the VA, "the maximum VA loan on an individual property is either the appraised value of the property or the purchase price, whichever is lower." And your lender still has to approve you: the VA states that "even if you have full entitlement (your COE shows that your basic entitlement is $36,000), your lender will still need to approve you for a loan."

So the answer to "how much can I borrow with nothing down" is not a published number. It is whatever you qualify for, up to what the house appraises for.

Full entitlement generally means you have never used the benefit, or you used it and have since restored it by paying off and selling the property. If you have a VA loan open right now, you have partial entitlement, and the math changes — that is a conversation, not a chart.

What is the VA funding fee, and will I pay it?

The funding fee is a one-time charge that replaces monthly mortgage insurance. It can be rolled into the loan rather than paid in cash. These rates have been in effect since April 7, 2023:

Purchase and construction loans

Refinances

Notice what the purchase table shows: putting 5% down cuts the fee to 1.5% whether or not you have used the benefit before, and it is the repeat user who saves the most by doing it. Anyone using the benefit a second time with nothing down pays 3.3%. On a $400,000 loan that is roughly $13,200 added to the balance, against $6,000 at 5% down. Whether that trade makes sense depends on what else the cash is doing — but nobody should make it by accident.

Who does not pay the funding fee

The VA waives it entirely if any of these apply:

• You are receiving VA compensation for a service-connected disability
• You are eligible for that compensation but receive retirement or active-duty pay instead
• You are receiving Dependency and Indemnity Compensation as a surviving spouse
• You are an active-duty service member with a proposed or memorandum disability rating before closing
• You are an active-duty member who provided evidence of a Purple Heart on or before closing

This exemption is worth thousands and gets missed. If you have a pending disability claim, say so early — timing relative to closing matters, and a fee paid in error can sometimes be refunded.

What is the residual income test?

This is the part of VA underwriting almost nobody explains, and it is the reason some borrowers are approved for a VA loan after being declined elsewhere.

Conventional and FHA underwriting lean heavily on debt-to-income ratio — a percentage. The VA also requires residual income: actual dollars left over each month after the mortgage, other debts, taxes, insurance, utilities, and maintenance are paid. The required amount varies by family size, region of the country, and loan size.

Two consequences follow, and they cut both ways:

• A borrower with a high DTI can still qualify if enough real money remains at the end of the month. VA guidelines allow flexibility when residual income comfortably exceeds the requirement.
• A borrower whose ratios look fine can fail if the residual number comes up short — a large household in a high-cost area, for instance.

If a lender has told you your ratios do not work, it is worth having someone run the VA residual calculation before you accept that answer.

Can a VA loan be assumed?

Yes, and this matters more in some markets than others.

A VA loan is assumable by a qualified buyer, including a buyer who is not a veteran. The buyer takes over the existing loan at its existing rate. When the rate on that loan is well below current market, assumability is a real asset attached to your house — something a conventional borrower does not have to sell.

The catch is entitlement. If the buyer is not a veteran substituting their own entitlement, yours stays tied to that loan until it is paid off, which limits your ability to use the benefit again. Assumption also requires lender and VA approval and is not fast. It is a genuine option, not a loophole.

What does the VA appraisal look for?

A VA appraisal does two things at once: it establishes value, and it checks the property against the VA's Minimum Property Requirements — safe, sound, and sanitary. Working heat, safe water and sewer, a sound roof, no exposed wiring, no visible structural failure.

For a well-maintained home this is uneventful. For a fixer, it is the thing that derails the deal at week four. If you are looking at a property that needs work, tell your loan officer before you write the offer, not after.

VA loans are also for primary residences. You are certifying that you intend to occupy the home, generally within 60 days of closing.

Talk to someone who does these

National One Mortgage is a VA lender. We are licensed in California, Arizona, Texas, Oklahoma, Alabama, Florida, and South Carolina, and several of our loan officers are veterans themselves.

If you want to know what you actually qualify for — including a residual income check before anyone tells you no — start a conversation and we will walk through it.

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FAQ

Do I need a certain credit score for a VA loan? The VA does not set a minimum credit score. Individual lenders set their own overlays, and those vary. A score that fails at one lender can pass at another, which is a reason to work with a broker rather than a single lender.

Can I use a VA loan more than once? Yes. The benefit is not one-time. If you have paid off and sold a previous VA-financed property, your entitlement is generally restored. If you still have a VA loan open, you may have partial entitlement available.

Does a VA loan have mortgage insurance? No. There is no monthly mortgage insurance on a VA loan. The one-time funding fee takes its place, and some borrowers are exempt from that as well.

Can I buy a multi-unit property with a VA loan? Yes, up to four units, provided you occupy one of them as your primary residence.

Can I get a VA loan with a previous foreclosure or bankruptcy? Often, yes, after a seasoning period that depends on the event and the circumstances. VA guidelines are generally more forgiving here than conventional ones.