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How to get a VA loan

American flag and key from home. VA Streamline Refinance loan concept.
VA loans have many benefits for those are eligible, including lower interest rates.

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The housing market has slowed down quite a bit in recent months. Sales have tapered off, prices have stopped their steep upward climb, and mortgage rates have even started to creep down a bit. They now hover around 6% — and are predicted to remain there for some time. 

While that’s down from the 7%-plus rates we saw at the end of last year, it’s still high compared to the record-setting lows seen not long ago. Fortunately, if you’re hoping to buy a home or refinance, shopping around for your lender — and, more importantly, your loan — can still help you get the best rates possible.

One option known to have particularly low rates is the VA loan. Below we will dive into what you need to know about this mortgage program — and how to get one for yourself. 

Start by getting a free personalized price quote so you know exactly what to expect.

What is a VA loan and who’s eligible?

A VA loan is a mortgage that is backed by the U.S. Department of Veterans Affairs. What this means is that the VA guarantees the loan and will pay back the lender if a borrower defaults and stops making payments. This assurance takes some of the risks off of lenders and allows them to offer more favorable terms and interest rates to those who qualify.

There’s a catch, though: VA loans are only available to active-duty members of the U.S. military (Army, Navy, Air Force, Marine Corps, Coast Guard, Space Force), veterans of these branches, and certain members of the National Guard and Reserves. In some cases, surviving spouses of veterans may be eligible. 

Applicants also must meet certain military service requirements. These vary depending on when they served, their ranking, and whether they served during peacetime or wartime.

If you think you could benefit from taking out a VA loan then start by requesting a free price quote.

VA loan benefits 

VA mortgages can have many benefits for those who qualify. Chief among them is their lower interest rates. 30-year, fixed-rate VA loan rates currently average nearly 40 basis points lower than rates on conventional loans according to Mortgage News Daily.

Another perk of VA loans is they don’t require a down payment (other loan programs require at least 3% down). This can be particularly helpful for borrowers who don’t have much in savings. 

The VA also limits the closing costs borrowers are allowed to pay, and there is no private mortgage insurance (PMI) either. This can help make buyers’ monthly payments more affordable.

How to get a VA loan

To get a VA loan, you will first need to request your COE — or Certificate of Eligibility, which shows a lender that you’ve met the department’s military service requirements and are eligible for a loan. You can do this through your eBenefits portal, by mail, or through your lender.

That’s another task you’ll have to complete: Choosing your lender. Only certain mortgage companies and banks are authorized to issue VA loans, so make sure to shop with that in mind. You should aim to get quotes from at least three lenders, as companies can vary widely on rates, terms, fees, and more. 

Once you’ve chosen a lender, you’ll fill out the full loan application, submit any financial documents required, and await your home’s appraisal. If the appraisal confirms the home value matches what you’ve offered for it, you’ll get a closing date, which is when you’ll sign the final paperwork and receive your keys.

You can easily start shopping for lenders that provide VA loans by using the table below.

Other options

VA home loans are only available to a select group of military servicemembers and veterans. If you don’t qualify, there are other government loan programs you might consider for your home purchase, including the FHA loan and the USDA loan. 

FHA loans require at least 3.5% down and have low credit score requirements. USDA loans are for use in rural and some suburban areas, have higher credit score minimums and require no down payment. Talk to a loan officer or mortgage broker to determine if either of these options is right for you.

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