VA 30-Year Fixed Mortgage Rates

What is a VA home loan?

Military service members and their families are in the unique position to build equity through real estate at a lower cost than typical homebuyers.

VA loans provide affordable mortgage options for military veterans, active service members and their families by easing some of the financial burdens associated with buying a home. Since its creation in the 1940’s, the VA mortgage program has helped millions of service men and women get a foothold in the housing market and build a stable financial future.

Provided by the U.S. Department of Veterans Affairs, this program allows lenders to issue financing with more flexible eligibility standards and repayment plans. As an eligible VA loan applicant, you’ll get the benefits of zero down payment requirements, lower credit score minimums, comparatively lower interest rates, and other purchasing perks that can only be accessed with a VA loan.

While the VA does not provide the financing used in a home purchase, they do cooperate with private lenders to build an affordable mortgage plan. The VA guarantees private lenders that home loans for qualified military members will be backed up should the home fall into foreclosure. This guarantee only extends to the lender and does not assist the borrower or prevent them from falling into foreclosure. This added government assurance grants lenders with the flexibility to expand homebuying opportunities for service members looking to apply for a mortgage.

An ideal VA loan applicant is a military service member or surviving spouse with a relatively clean financial background. Let’s take a closer look at these VA mortgage requirements and how you can be eligible for this type of loan.

VA mortgage requirements

While the program is designed to help military service members get housing, not everyone who served is eligible. In order to qualify for a VA mortgage, there are a few important requirements you should be aware of:

For some cases, such as discharge or service-related injury, you might be exempt from certain length-of-service requirements. If you’ve had a bad conduct or dishonorable discharge in the past, you might not be eligible.

These exceptions can vary from case to case, so be sure to check the VA for your specific length of service requirement, discharge status and whether it can be upgraded.

Surviving spouses of veterans who were killed, injured or captured in the line of duty are also eligible. In order to secure a VA loan as a spouse, there are a few additional requirements:

Again, there can be exceptions to these requirements. If you have further questions about your specific VA loan eligibility, be sure to contact the Department of Veterans Affairs.

What is a good VA interest rate?

VA loan interest rates are typically lower than the interest on conventional loans, but the average interest rate on VA mortgages is still connected to real-estate trends and the state of the economy.

Since VA mortgage rates are so closely tied to the housing market, the opportunity for a good VA interest rate comes when lenders reduce their rates for mortgages overall.

How VA loan rates compare other mortgage rates

Thanks to the government insurance of these mortgages, lenders are able to offer competitive VA loan rates that are usually lower than conventional mortgages.

A difference of less than a percent might not seem like much, but throughout the term of the loan, you will have saved thousands in interest with the lower rate. Check out the links below for interest rates on other types of mortgages and how they stack up to VA loans:

Who sets VA mortgage rates

Even though the U.S. Government guarantees that a portion of the loan is insured, VA mortgage rates are not set by the Department of Veterans Affairs.

Your lender will always make the final decision on whether to approve a loan and what interest rate is appropriate for your case. The interest rate is set after your lender conducts a thorough review of your credit report and debt management history, along with an analysis of current market trends within the real estate economy.

Once your lender can gauge the level of risk associated with your application, they’ll attach an interest rate to their initial financing offer.

VA mortgage advantages

As a popular lending option, VA mortgages come with several unique advantages that continue to help military members become homeowners. Let’s take a closer look at how you can benefit from a VA home loan:

Zero down payment

Conventional mortgages will almost always require buyers to make a sizable down payment on their new property. Borrowers will typically pay about 20% of the home’s sales price for their down payment, presenting a major hurdle when gearing up to buy a home.

In a conventional loan scenario, typical down payments can be much higher than on a VA loan. Before applying for a 30-year fixed mortgage, borrowers will have spent years saving for this expense alone. VA loans, on the other hand, do not require a down payment.

Bypassing the down payment can help streamline the mortgage process and get you into your new home sooner. By avoiding this major expenditure, you’ll also be able to explore home options in a wider price range with greater flexibility.

When the housing market gets competitive, an offer that comes with a zero down payment could also appeal to sellers. Eliminating this upfront cost from the mortgage process removes the possibility that the buyer can’t afford the expense and the sale will fall through. In addition to the security of government backing, sellers might be more eager to accept a VA offer by avoiding the barrier of a down payment altogether.

Lower interest rates

Upfront costs aren’t the only way you’ll save with a VA loan. Thanks to the government backing of these mortgages, lenders can offer comparatively lower fixed rate lending options .

The interest rates on VA loans will still vary depending on your personal financial background, but VA mortgage rates tend to be generally lower than those on conventional loans.

No private mortgage insurance requirements

On a typical loan, a buyer who makes a down payment less than 20% would likely need to purchase mortgage insurance. Private mortgage insurance, or PMI, protects the lender’s stake in the property but is paid for by the borrower. The premiums for this coverage are folded into your monthly mortgage payments, adding to an already hefty repayment plan.

Since VA mortgages are backed by the U.S. government and have no down payment required, PMI is not necessary, giving eligible applicants yet another opportunity to save on their homebuying journey.

Easier to qualify

VA loans come with no credit score minimum, meaning financial trouble in your past won’t automatically exclude you from taking advantage of the program. Even though the VA does not have a credit score minimum, your lender will still have a credit threshold that you’ll need to clear to secure financing.

However, the interest rate attached to mortgages increases as applicants’ credit scores decrease, so it can still be difficult to get a loan with bad credit.

100% LTV on VA cash-out refinances

As of Jan 1, 2025, Guaranteed Rate is now offering up to 100% max LTV (loan-to-value ratio) on VA cash-out refinances up to $2M. Most lenders and cash-out loans cap your LTV at 90% for VA loans, which means a smaller loan for you. However, a Guaranteed Rate VA loan offers cash-out refinances with an LTV of 100%, putting more money in your pocket

VA mortgages disadvantages

Before you jump into the VA loan process, it’s best to be aware of some of the mortgage structure’s limitations:

VA funding fee

Even though you won’t have to make a down payment for a VA loan, this type of mortgage still comes with an upfront expense. VA funding fees are an expense paid to the U.S. Department of Veterans Affairs to supplement the cost of VA mortgages overall. As of 2021, a zero down payment VA loan for first-time applicants requires a funding fee of 2.3% of the home’s appraised value, according to VA.gov .

On a $200,000 home, the borrower has to pay $4,600 to satisfy the expense.

When it comes time to pay your VA funding fee, you can either settle this cost in a one-time payment at closing, or fold it into your monthly mortgage bill and pay it off over time.

Intended for primary residences

If you’re looking for a vacation home or want to buy an investment property, you won’t be able to use a VA loan. These mortgages are only intended for purchases of primary residences, or to refinance an owner-occupied home.

For second homes or buying rental properties, you’ll need to seek out a different conventional structure, such as a fixed or adjustable rate mortgage.

Seller’s discretion

Accepting an offer is always at the seller’s discretion, which can be impacted by the asking price, untimely payments and even the buyer’s type of mortgage.

Some sellers might perceive VA loans as unreliable, or assume it would add unnecessary complexity to their sale. When sellers feel this reluctance, they might opt for offers with a more conventional financing structure.

VA home loan rates vs. VA refinance rates

While the VA program can be used to buy a home as well as refinance, VA refinance rates are often different from those attached to home purchases.

Refinance rates, just like VA mortgage rates, are impacted by the general housing economy, but come with other stipulations that can affect your final interest amount. The type of VA refinance loan you choose, in addition to your personal financial situation, will also weigh the interest rate you’re given.

Using a mortgage refinance calculator can help you understand how much refinancing will cost and whether a VA refinance loan is the best option.

VA loan limits

VA loan applicants previously ran into limits on mortgages over $144,000. As of 2020, eligible VA loan applicants with full entitlement will no longer have limits on how much they can borrow. If you’re an active service member, veteran or surviving spouse, you can potentially be approved for enough financing to cover the appraised value of your target property.

If you’ve defaulted on a VA loan in the past, or have an active VA loan on the books, you’ll still be limited in how much you can borrow. These limits describe the highest-value loans the VA can back up without requiring a down payment.

VA loans vs. USDA loans

Similar to VA loans, USDA loans are designed to make it easier for qualifying families to achieve their real estate goals. Backed by the U.S. Department of Agriculture, USDA loans also assure lenders that their share of the sales price is protected and can approve loans with more lenient terms as a result.

However, where VA mortgages assist military members in buying a home, USDA loans are geared towards lower income families in mostly rural communities and can only be administered if the property’s location meets the USDA guidelines.

VA loans vs. FHA loans

FHA loans , or Federal Housing Administration loans, are another type of government-insured mortgage that provides a path to homeownership for buyers who can’t qualify for a conventional home loan.

Both mortgage structures provide substantial benefits for homebuyers, but VA and FHA loans cannot be used on the same home. Both programs require the financing to go towards your primary residence, so you can’t use them to purchase an additional property either.

OriginPoint Mortgages

Zero down payment requirements and comparatively lower interest rates have made VA home loans one of the more popular lending structures. If you’re an active military member, veteran or surviving spouse, a VA loan might offer the best financing structure for your homeownership goals.

Be sure to consult with multiple lenders to learn more about your borrowing potential and how to apply for a mortgage .