The VA Home Loan, Explained
Updated July 2026
The VA home loan is one of the strongest benefits of military service: a government-backed mortgage with no down payment and no monthly mortgage insurance. Here is how it works and how to use it.
Why it beats a conventional loan
- No down payment is required on most VA purchase loans — you can finance 100% of the price.
- No monthly mortgage insurance (PMI), ever — a big monthly saving versus low-down conventional or FHA loans.
- Competitive rates and limits on the closing costs the lender can charge you.
The VA funding fee (and who skips it)
Instead of mortgage insurance, most borrowers pay a one-time VA funding fee. For a first-time purchase with no down payment it is about 2.15% of the loan; later uses run higher (up to about 3.3%). A larger down payment lowers the fee. You can roll it into the loan.
You are exempt from the funding fee if you receive VA disability compensation (or are eligible to but take retirement/active-duty pay instead), or are a surviving spouse using the benefit. That makes an already-strong loan even better for disabled veterans.
Your Certificate of Eligibility (COE)
The COE proves to a lender you qualify. Most VA-savvy lenders can pull it instantly, or you can request it on VA.gov. Eligibility is based on your service — generally enough qualifying active-duty time, or Guard/Reserve service, with an other-than-dishonorable discharge.
Guard & Reserve eligibility
National Guard and Reserve members qualify too. In general you are eligible with either 6 creditable years in the Selected Reserve or National Guard (and still serving, or honorably discharged/retired), or 90 days of non-training active-duty service. Note that Title 32 duty does not count as "active duty" for the 90-day path, but it does count toward the 6-year requirement. Your COE will reflect this once your service is documented.
You can use it more than once
The VA loan is not a one-time benefit. You can reuse it, and even have more than one VA loan at a time in some cases. Once you sell and pay off a VA loan, your full entitlement is typically restored for the next one.
Refinancing with the VA
Two VA refinance options exist: the Interest Rate Reduction Refinance Loan (IRRRL or "streamline") to lower your rate with minimal paperwork, and a VA cash-out refinance to tap equity. See the VA loan and refinance benefits for details.
Frequently asked questions
Do you really need no down payment for a VA loan?
Correct — most VA purchase loans require zero down payment and finance 100% of the home price, as long as the price is at or below the appraised value. A down payment is optional and lowers your funding fee.
Who is exempt from the VA funding fee?
Veterans who receive VA disability compensation (or are eligible for it but receive retirement/active-duty pay instead), and eligible surviving spouses, are exempt from the funding fee. Purple Heart recipients on active duty may also qualify.
Can you use the VA home loan more than once?
Yes. The VA loan is a reusable benefit. After you sell a home and pay off the loan, your entitlement is generally restored, and in some situations you can hold more than one VA loan at a time.
Does the VA loan have mortgage insurance?
No. VA loans never require monthly private mortgage insurance (PMI), even with no down payment. Instead there is a one-time funding fee, which many disabled veterans are exempt from.
Can National Guard and Reserve members get a VA home loan?
Yes. Guard and Reserve members generally qualify with 6 creditable years in the Selected Reserve or National Guard (while still serving or after an honorable discharge/retirement), or with 90 days of non-training active-duty service. Title 32 duty counts toward the 6-year requirement but not the 90-day active-duty path.