Zero down.
No mortgage insurance.

VA Loans at a glance

A VA loan is originated by a private lender and guaranteed, not funded, by the U.S. Department of Veterans Affairs for eligible veterans, active-duty service members, certain Reserve/National Guard members, and qualifying surviving spouses. The guaranty, typically 25% of the loan amount, is what lets lenders offer terms a conventional loan can't: with full entitlement, there's no maximum loan amount and no down payment required at any price the appraisal and your lender's affordability review will support, and VA loans never carry monthly mortgage insurance, regardless of loan-to-value. In its place is a one-time funding fee, generally 1.25%–3.3% of the loan depending on down payment and whether you've used your benefit before, waived entirely for veterans receiving VA disability compensation, Purple Heart recipients, and a few other exempt groups. Underwriting weighs residual income, what's left over each month after debts and shelter costs, at least as heavily as the 41% debt-to-income guideline, which is explicitly not a hard cap. VA also offers two refinance paths unique in the mortgage market: the Interest Rate Reduction Refinance Loan (IRRRL), a low-documentation refinance of an existing VA loan into a lower rate, and a cash-out refinance with its own classification rules and a 36-month recoupment test. VA loans are also assumable, a qualified buyer, veteran or not, can take over your rate and terms with lender and VA approval, a meaningful asset when your rate sits well below the market. This page is built from the VA's own Lender's Handbook (Pamphlet 26-7) and current VA.gov guidance, and is written with the respect this benefit, and the service behind it, deserve.

A guaranty, not a government loan

A VA loan gets you terms no conventional or FHA loan can match: $0 down with full entitlement, at any price a lender and appraisal will support, no monthly mortgage insurance at any loan-to-value, and underwriting that looks at your actual ability to cover living expenses, not just a ratio. Behind those terms is a federal guaranty, the Department of Veterans Affairs guarantees a portion of the loan against loss, typically 25%, which is what makes them possible in the first place.

This benefit belongs to you because you served, it is not a favor, a workaround, or a loan of last resort, and it is not something VA or any lender gives away as a special favor or a "new program." It's a federal entitlement, written into law, available to eligible veterans, active-duty service members, certain Reserve and National Guard members, and qualifying surviving spouses, and it can be used more than once in a lifetime once restored.

This page is meant as a general guide to how VA financing typically works, built from the VA's own Lender's Handbook (Pamphlet 26-7, Revised) and current VA.gov guidance, not a quote, a pre-qualification, or the final word on what you qualify for. The TW Team is not affiliated with or endorsed by the Department of Veterans Affairs; see the compliance notice at the bottom of this page.

VA vs. FHA vs. Conventional, Side by Side

This comparison reflects typical VA, FHA, and conventional/conforming guidelines; all three vary by lender, investor overlay, and individual scenario, so treat it as a general frame of reference rather than a guarantee. Conventional figures shown are for a standard agency loan, not a specific lender's overlay.

Eligibility & the Certificate of Eligibility (COE)

Eligibility turns on when and how long you served, and your discharge characterization. The service windows below come directly from the VA's own Lender's Handbook; they look technical, but we'll confirm your specific eligibility for you in minutes through VA's own systems, you don't need to work this out yourself.

Minimum Service by Era

If your service began after September 7, 1980 (enlisted) or October 16, 1981 (officer), the "2-year rule" generally applies instead: 24 continuous months of active duty, or the full period you were called to active duty if less, but never less than 90 days during a wartime era or 181 continuous days during peacetime. One day of service is sufficient if you were discharged or released specifically for a service-connected disability.

• Discharge characterization. Generally must be other than dishonorable. A general discharge under honorable conditions can still qualify; VA makes a case-by-case character-of-service determination for discharges below that.
• Reserve & National Guard. Generally eligible after completing 6 years of service in a drilling/active status with an honorable discharge, a general-under-honorable-conditions discharge does not meet this specific path. Members called to federal active duty for a qualifying period may also establish eligibility sooner under the active-duty rules above. Time in the Individual Ready Reserve or a control group doesn't count.
• Surviving spouses. Unremarried spouses of a veteran who died from a service-connected cause generally qualify, as do spouses who remarried on or after age 57 and on or after December 16, 2003, spouses of a service member listed MIA or POW for at least 90 days (one-time use), and in some cases spouses of a veteran who died from a non-service-connected cause but was rated totally disabled for a qualifying period before death, each subject to a Dependency and Indemnity Compensation (DIC) eligibility determination.
• Getting your COE. In most cases we pull it instantly through VA's automated system during your application. If it can't be issued automatically, we submit supporting documentation to a VA Regional Loan Center on your behalf. You can also self-request a COE at va.gov or by mailing VA Form 26-1880 (surviving spouses applying for the first time use VA Form 26-1817 instead).

How a VA loan comes together

1. Confirm eligibility & pull your COE. We confirm your service meets the eligibility windows above and pull your Certificate of Eligibility, usually instantly through VA's automated system.
2. Check your entitlement. Full entitlement means no down payment at any price. If you have an existing, unpaid VA loan elsewhere, we'll walk through the partial-entitlement math together, see the worked example below.
3. Underwrite on residual income, not just DTI. We look at what's actually left over each month after your debts and shelter costs, by region and family size, often more forgiving than a flat debt-to-income cutoff.
4. Close, with the funding fee handled your way. Finance it into the loan, pay it in cash, or skip it entirely if you're exempt, we'll show you exactly what applies before you close.

Entitlement & down payment

VA doesn't publish a maximum loan amount, and it doesn't publish a down-payment formula either. What it publishes is your entitlement, the dollar amount VA will guarantee on your behalf, and lenders apply their own convention on top of it to decide how much cash, if any, you need at closing.

Full entitlement

You've never used VA financing, or you fully restored your entitlement after paying off a prior VA loan.

• No down payment required, at any price
• No maximum VA loan amount
• Your county's conforming loan limit is informational only, it does not cap you

Partial (reduced) entitlement

You have an existing, unpaid VA loan, or used entitlement that hasn't been fully restored.

• Your county's conforming loan limit governs the zero-down math
• A down payment is required once the price exceeds what your remaining entitlement supports at $0 down
• The exact figure is a worked calculation, not a lookup, see below

Worked Example: Partial Entitlement (VA's own published figures)

The rule lenders apply is down payment = max($0, 25% of price − entitlement available). 38 U.S.C. 3703 and 38 CFR 36.4302 cap VA's guaranty at 25% of the loan, that's a ceiling, not a requirement, and VA itself never publishes a down-payment formula at all. The 25%-of-price coverage test above is the near-universal lender and secondary-market convention that fills that gap, not a VA rule, and a specific lender could in principle compute it differently. We'll run your exact numbers before you assume either way.

Below a $144,000 loan amount, the county limit stops governing, and if your entitlement wasn't restored, you may have none left at any size.

VA's own underwriting examples are explicit on this: if a loan amount is not over $144,000 and the borrower has no remaining entitlement, they cannot use the VA home loan benefit to guarantee that loan without first obtaining restoration of entitlement, no amount of down payment fixes that, because it's an eligibility problem, not a down-payment problem. Below $144,000, a separate size-banded basic-entitlement table applies instead of the county-limit math above. If this might describe your situation, a prior VA loan that was paid off, sold, or is still outstanding, tell us before we run numbers, since restoring entitlement is usually straightforward but is a step, not an assumption.

A spouse co-borrower doesn't touch your entitlement math. A non-veteran, non-spouse co-borrower generally does.

Your spouse. Borrowing with your spouse works exactly like borrowing alone, your full entitlement applies to the whole loan, and adding them doesn't trigger a down payment on its own. Their income and credit are simply underwritten alongside yours, and the entitlement math above doesn't change.

Another eligible veteran. Two veterans can combine entitlement on a shared loan, each contributing their own, which can support a larger zero-down purchase together than either could alone.

A non-veteran who isn't your spouse, a parent, a partner you're not married to, a friend, creates what VA calls a "joint loan." VA generally guarantees only your own undivided interest in the loan, commonly half, so a down payment is typically required to cover the portion that isn't backed by your entitlement, commonly cited at around 12.5% of the total loan amount (equivalent to a full 25%-of-price down payment test applied to just the co-borrower's half-share). Their income and credit can still help you qualify, but the down payment math changes the moment they're added, so tell us upfront if you're considering this, we'd rather run it correctly the first time than recalculate after you've made an offer.

The VA funding fee, in full

VA loans never carry monthly mortgage insurance. In its place is a one-time funding fee, paid at closing or financed into the loan, that helps keep the program funded for future veterans at no cost to taxpayers. Figures below reflect the current table effective April 7, 2023, rates have changed multiple times by legislation, most recently eliminating the old Reserve/National Guard surcharge, so don't rely on an older table you may find elsewhere online. In a purchase, you can also negotiate seller concessions toward a buydown, which our temporary buy-down page explains.

Purchase & Construction Loans

Refinancing & Other Loan Types

The fee applies equally to regular military, active duty, Reserve, and National Guard borrowers, a surcharge that used to apply to Reserve/Guard borrowers has been eliminated. "Subsequent use" applies if you've had a VA loan before, regardless of down payment, except on the 5%+ bands where first and subsequent use are priced the same. The funding fee can be financed into your loan without regard to value or loan amount, it sits outside the entitlement and guaranty calculation entirely.

You're exempt from the funding fee if any of the following apply: confirmed at closing, not assumed.

• Receiving VA compensation for a service-connected disability
• Eligible for that compensation but receiving retired or active-duty pay instead
• A surviving spouse receiving Dependency and Indemnity Compensation (DIC)
• A service member with a proposed or memorandum (pre-discharge) rating establishing eligibility for compensation, issued on or before closing
• An active-duty Purple Heart recipient, with evidence provided on or before closing, effective January 1, 2020 under the Blue Water Navy Vietnam Veterans Act of 2019

2026 county conforming loan limits

With full entitlement, these figures don't apply to you at all, there is no VA maximum loan amount. They matter only if you have remaining (partial) entitlement from an existing, unpaid VA loan, since the zero-down math above is tied to your county's conforming loan limit.

2026 Conforming Loan Limits (1-Unit)

These are the FHFA conforming loan limits for 2026, which VA uses as the county limit in the partial-entitlement down-payment calculation above. Both Orange County and Los Angeles County sit at the national high-cost ceiling.

IRRRL & cash-out refinancing

VA has no "rate-and-term" refinance category. Every refinance is either an IRRRL, or a cash-out refinance classified as Type I or Type II depending on whether the new loan, including the funding fee, exceeds your current payoff. That classification isn't a technicality; it determines which rules apply.

IRRRL vs. Cash-Out Refinance

A Type I cash-out refinance is one where the new loan, funding fee included, doesn't exceed your current payoff, no real cash out, just a rate or term change without IRRRL's eligibility limits. A Type II is one where it does, genuine cash out, with full underwriting. The same transaction can be Type I for an exempt borrower and Type II for a non-exempt one, purely because of how the fee changes the math.

Your closing costs and fees must pay for themselves within 36 months: on every IRRRL and Type I refinance.

Under 38 U.S.C. 3709(a), the reduction in your principal-and-interest payment must recoup your refinance costs within 36 months, calculated on the payment reduction alone, the funding fee and any prepaid interest are excluded from that numerator. This applies to every IRRRL and every Type I cash-out refinance. A Type II cash-out refinance is exempt by statute, because requiring recoupment there would put a veteran in a worse financial position than a non-veteran borrower taking the same cash out. Seasoning for either refinance type requires 210 days since your first payment due date and six consecutive monthly payments made, whichever comes later.

Qualifying requirements

• Qualifying service under the eligibility windows above, with a discharge other than dishonorable
• A valid Certificate of Eligibility (COE)
• Owner-occupied primary residence, with limited exceptions for an active-duty spouse
• No minimum credit score set by VA itself; lenders commonly overlay their own, often 580–620
• Satisfactory credit history and income sufficient to meet the residual-income guideline for your region and family size
• Debt-to-income evaluated as a 41% guideline, secondary to residual income, not an automatic cutoff
• Funding fee paid at closing or financed, unless you're exempt
• Property located in the U.S. or its territories, meeting VA's Minimum Property Requirements
• Condos must be on VA's approved list (PUDs do not require separate VA project approval)
• Sufficient entitlement for the loan amount, full entitlement, or partial entitlement plus down payment if needed

Property & borrower eligibility

Eligible

• 1–4 unit primary residences (you must occupy one unit if multi-unit)
• VA-approved condos, and PUDs without separate VA condo approval
• Manufactured homes on a permanent foundation meeting VA requirements
• New construction through a VA-registered builder meeting Minimum Property Requirements
• Refinancing an existing VA loan (IRRRL) or a non-VA loan into VA financing (cash-out)
• Properties in the 50 states and U.S. territories (Puerto Rico, Guam, U.S. Virgin Islands, American Samoa, Northern Mariana Islands)

Not Eligible

• Investment-only properties with no owner occupancy
• Vacation or seasonal-use-only homes
• Cooperative housing (co-ops), generally
• Condo projects not on VA's approved list and not otherwise approvable
• Properties with health or safety issues that don't meet Minimum Property Requirements, until repaired
• Properties outside the U.S. and its recognized territories

How VA condo & PUD approval works

VA maintains its own nationwide list of approved condominium projects, separate from FHA's, a project approved for FHA isn't automatically approved for VA, and vice versa. PUDs (planned unit developments) don't require this separate project approval; condominiums do.

• Already HUD or USDA approved? VA generally adds the project to its own approved list on evidence of that approval, without a full independent VA review.
• Not yet approved by anyone? A lender or sponsor submits the project's organizational documents, declaration, bylaws, articles of incorporation, budget, and more, to VA for a full review before any unit in the project is eligible for VA financing.
• Attorney's opinion letter. For a project not already HUD/USDA-approved, an attorney's written opinion that it meets VA's requirements can meaningfully speed up VA's own review.
• First lien, subordinate HOA dues. Every property in a common-interest community must be secured by a first lien, with any mandatory HOA assessment subordinate to the VA-guaranteed mortgage.

Ask your real estate agent or HOA whether the project is already on VA's approved list before you write an offer. We can check a project's current VA approval status for you.

VA loans are assumable

This is one of the most overlooked features in all of mortgage lending. A buyer, veteran or not, can take over your VA loan's rate, balance, and remaining term instead of getting a brand-new loan at whatever rate the market is offering that day. In a higher-rate environment, that can be worth more to a buyer than almost anything else about your home.

• The buyer doesn't need to be a veteran. Anyone your lender approves as creditworthy can assume the loan, subject to standard underwriting on the buyer's credit and income.
• Lender and VA approval are both required for loans closed on or after March 1, 1988, which covers essentially every loan being sold today.
• The assumer pays a 0.5% funding fee on the remaining principal balance, unless they independently qualify for an exemption.
• Get a Release of Liability (VA Form 26-6381). Without it, you, the original borrower, stay on the hook if the new owner misses payments, which can damage your credit even though you no longer own the home.
• Your entitlement stays tied up unless the buyer is a qualifying veteran who substitutes their own. If a non-veteran assumes your loan, your entitlement in that property generally remains committed until the loan is paid off, limiting your ability to use VA financing again in the meantime.

Good to know before you apply

These are the VA-specific rules and figures that most often get missed or misstated elsewhere, worth knowing going in, even though your exact terms depend on your scenario.

• Residual income matters more than your DTI ratio. VA's underwriting standard (38 CFR 36.4340) weighs what's left over each month, after debts and shelter costs, against regional, family-size-based guideline figures from the Bureau of Labor Statistics. A thin DTI story with strong residual income can approve where a DTI-only lens would say no.
• 41% DTI is a guideline, not a hard cap. VA's own Handbook is explicit that debt-to-income "should not automatically trigger approval or rejection of a loan." A ratio above 41% gets closer scrutiny unless residual income exceeds the regional guideline by at least 20%, in which case it's generally not a barrier at all.
• Tax-free income can be grossed up by 25% (counted at 125% of its actual amount) for debt-to-income purposes, military allowances, child support, and certain disability or public-assistance income among them, though not for the residual-income calculation itself.
• Occupancy generally means within 60 days of closing, with exceptions extending up to 12 months for documented circumstances. If you're on active duty and can't occupy personally within that window, your spouse or dependent child's occupancy can satisfy the requirement.
• Seller concessions are capped at 4% of value, but that cap applies only to true "concessions" (paying your funding fee, payoff of your debts, gift items, and similar). Normal seller-paid closing costs and discount points are separate and uncapped, a nuance that's frequently described wrong.
• No VA-set minimum credit score. VA itself doesn't publish a FICO floor, it's the most flexible government-backed program in that respect, but individual lenders, including our program guidelines, commonly set their own overlay, often in the 580–620 range.
• Discount points are unlimited at purchase, in any reasonable amount; on a refinance, up to two points can be rolled into the loan, with anything beyond that paid in cash.
• Maximum loan term is 30 years and 32 days on a standard amortized loan, with payments structured to reduce principal at least annually.
• Entitlement is reusable, not one-time. Pay off or sell the property securing a VA loan and your entitlement is restored for future use, this benefit is designed to be used more than once across a lifetime, including, in some cases, a one-time restoration without a sale.
• Up to $6,000 in energy-efficient improvements can be added to the loan amount without a separate appraisal, on top of the purchase price.
• Interest rates are negotiated, not set by VA. VA doesn't prescribe mortgage rates, they're negotiated between you and your lender like any other loan.
• Thinking about a co-borrower? A spouse doesn't change your entitlement math at all. A non-veteran, non-spouse co-borrower generally does, through what VA calls a "joint loan", see the full co-borrower breakdown in the Entitlement & Down Payment section above.

How this page, and everything we send you about VA financing: is required to be worded.

VA's own Lender's Handbook treats veterans as, in Congress's words, "a special class of citizen," and specifically prohibits advertising that implies VA has a "new" refinance program (the IRRRL program dates to 1980), that a lender has some special or exclusive relationship with VA, that a communication comes from VA itself, or that encourages "skipping payments" as a reason to refinance. We don't use any of that framing, on this page or anywhere else, and violations of this policy are sanctionable under 38 CFR Part 44.

Separately, and consistent with the Equal Credit Opportunity Act: your veteran status, disability rating, and surviving-spouse eligibility category are used only to confirm eligibility and any applicable exemption, never to rank, sort, or compare applicants against one another, and never presented as a pass/fail judgment on your creditworthiness. Nothing on this page is an extension of credit, a commitment to lend, or a statement of your individual terms.

What are the advantages of a VA loan?

• $0 down payment with full entitlement, at any price a lender and appraisal will support
• No monthly mortgage insurance, ever, at any loan-to-value
• No minimum credit score set by VA itself
• Underwriting weighs real residual income, not just a DTI cutoff
• Funding fee waived entirely for disabled veterans and several other exempt groups
• Assumable by a future buyer, veteran or not, a real asset if your rate ages well
• Reusable entitlement, this benefit isn't a one-time perk
• A dedicated low-documentation refinance (IRRRL) most other programs don't offer in the same form

What are the trade-offs?

• Available only to those who meet VA's service or surviving-spouse eligibility requirements
• Funding fee adds real upfront cost at $0 down unless you're exempt, 2.15% on first use, 3.3% on subsequent use
• Owner-occupied primary residences only, no investment-only use
• Condos must be on VA's own approved list, separate from FHA's
• Partial entitlement, from an existing unpaid VA loan, complicates the down-payment math
• Some sellers and listing agents mistakenly perceive VA offers as weaker in competitive, multiple-offer markets

No maximum loan amount applies with full entitlement, subject to lender affordability review and the appraisal supporting the price. A loan limit tied to your county's conforming loan limit still applies if you have remaining (partial) entitlement from a VA loan you haven't paid off, see Entitlement & Down Payment above. These are program parameters, not loan terms: your rate, APR, and full repayment schedule are disclosed in your personalized Loan Estimate, not on this page. Equal Housing Opportunity. TW Team operates through Lower, LLC, NMLS ID# 1124061, 5950 Symphony Woods Road, Suite 312, Columbia, MD 21044. The team serves borrowers throughout California, with loans in additional states originated through team members licensed in those states; see our licenses page for the current list. This page is intended for consumers in states where TW Team and Lower, LLC are licensed to originate; it does not constitute an offer in any state where such an offer would not be permitted. We consider all qualified applicants for credit without regard to race, color, religion, national origin, sex, marital status, age, disability, or any other basis prohibited by the Equal Credit Opportunity Act. TW Team and Lower, LLC are not affiliated with or endorsed by the U.S. Department of Veterans Affairs (VA). This page is not a VA publication and has not been reviewed or approved by VA. VA loans are originated by private lenders and guaranteed, not funded, by the Department of Veterans Affairs; VA does not lend money directly to borrowers. This page is a general, educational guide to how VA financing typically works and is not a quote, pre-qualification, rate lock, or commitment to lend; eligibility rules, entitlement amounts, funding fee rates, and underwriting guidelines are set by VA and federal statute, are subject to change without notice, and your actual terms depend on your service history, credit, income, property, and the guidelines in effect at the time of application. Not all applicants will qualify. Figures referenced above, including the current VA funding fee table (effective for loans closed on or after April 7, 2023), the 2026 FHFA conforming loan limits used for the partial-entitlement calculation ($832,750 baseline and $1,249,125 high-cost ceiling for a 1-unit property, with Maui and Kalawao Counties, HI at $1,299,500), and the residual-income and debt-to-income guidelines under 38 CFR 36.4340, are general summaries of the VA's Lender's Handbook (Pamphlet 26-7, Revised) and current VA.gov publications, simplified for a consumer audience; they do not capture every exception, are subject to change by VA or Congress at any time, and individual lenders, including TW Team, may apply additional overlays beyond VA's published minimums, including minimum credit score requirements VA itself does not impose. The down-payment formula shown for partial entitlement is a lender and secondary-market convention, not a rule VA itself publishes, and a specific lender could compute it differently; confirm your exact figure with us before relying on it. Eligibility figures, service-era dates, funding fee exemptions, and surviving-spouse provisions referenced above are presented for educational purposes only and are applied without regard to race, color, religion, national origin, sex, marital status, age, receipt of public assistance income, or the good-faith exercise of any right under the Consumer Credit Protection Act, consistent with the Equal Credit Opportunity Act and Regulation B; meeting a published eligibility threshold is not an approval, a pre-qualification, or a guarantee of any specific rate, fee, or term, and a file can be denied at a qualifying score or service history based on the full underwriting picture. This page is written in a manner intended to comply with VA's advertising requirements, including the prohibition on implying VA sponsorship, a special or exclusive VA relationship, or a "new" VA refinance program; it is not reviewed by VA for compliance. Consult VA's official Lender's Handbook (Pamphlet 26-7) and current VA.gov guidance, available at va.gov, for the complete and current requirements.

Sources: VA Home Loans (VA.gov) · Apply for a COE · NMLS Consumer Access · View all loan programs