What is the maximum VA loan?

Although there is no maximum VA loan (limited only by the reasonable value or the purchase price), lenders generally will use an applicant’s credit score and ability to repay the loan as guidelines.

What types of repayment options are available?

The guarantees thirty-year loans with a choice of repayment plans: Traditional fixed payment (constant principal and interest); Graduated Payment Mortgage, or GPM (low initial payments which gradually rise to a level payment starting in the sixth year); and in some areas, Growing Equity Mortgages, or GEMs (gradually increasing payments with all of the increase applied to principal, resulting in an early payoff of the loan). There is no prepayment penalty.

Do all local lenders offer VA Loans?

Not necessarily. Choose a VA-approved lending institution that can handle your home loan. A lender can help you review your credit history and determine how much of a loan you can qualify for. Be aware that different lenders have different closing costs and other fees, so it pays to shop around.

What service is not eligible for a VA Home Loan?

You are not eligible for VA financing solely based upon Active Duty for Training in the Reserves or National Guard.

Note: Guard and Reservists are eligible if they were “activated” under the authority of Title 10 or Title 32 U.S. Code. Those with Title 32 service must have at least 30 days continuous active service.

What if I’ve used a VA Home Loan Before?

You can have previously-used entitlement “restored” one time only in order to purchase another home with a VA loan if the borrower has paid off the prior loan but still owns the property, and wants to use his entitlement to purchase a second home. This often occurs with active duty borrowers who PCS to a new station but want to keep their existing home for retirement. However, if the prior loan has been paid off and the property is no longer owned, they can have their entitlement restored as many times as they want. They can re-use their VA eligibility for every home purchase from the first to the last.

Also, veterans who have used a VA loan before may still have remaining entitlement (see chart) to use for another VA loan. A veteran’s maximum entitlement is $89,912, and lenders will generally loan up to four times your available entitlement without a down payment, provided your income and credit qualifications are fine, and the property appraises for the asking price. Lenders may require that a combination of the guaranty entitlement and any cash down payment must equal at least 25 percent of the reasonable value or sales price of the property, whichever is less.

For Alaska, Hawaii, Guam, and U.S. Virgin Islands residents, note that maximum original loan amounts have now been increased 50% higher for first mortgages.

Remaining entitlement and restoration of entitlement is not automatic. It can be requested through the nearest VA office by completing VA Form 26-1880. The entitlement may also be restored one time only if the veteran has repaid the prior VA loan in full but has not disposed of the property purchased with the prior VA loan.