A VA loan is a mortgage loan guaranteed by the Veterans Administration. It was created in 1944 and signed into law by President Franklin D. Roosevelt. A VA loan provides veterans and/or their surviving spouses with a federally guaranteed home with zero down payment. The program, also referred to as the GI Bill, has been highly successful and has helped millions of American veterans and their families acquire a home.
- No down payment.
- VA does not require private MIP.
- Limit on the amount of origination fees and closing costs that the lender can charge.
- Limit also placed on appraisal fees.
- Borrower must have a Certificate of Eligibility (CoE) from the VA in order to avoid a longer processing time.
- Borrowers are required to make a one-time funding fee based on loan amount and applicant's service length.
- Closing costs may be paid by the lender and/or the seller.