What troops and retirees need to know about the VA home loan in 2025 By Leo Shane III of the Air Force Times

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Millions of service members and veterans have used the Department of Veterans Affairs home loan program since it took shape near the end of World War II. It continues to be one of the most popular benefits for veterans.

According to the VA, lenders issued 416,373 VA-backed loans totaling more than $155 billion in the fiscal year 2024, with an average loan amount of $373,291.

The VA doesn’t issue the loans itself but backs loans issued by financial institutions. The VA guarantees a percentage of an eligible beneficiary’s loan to purchase or refinance a home, allowing the lender to provide better, more affordable terms and often letting the borrower seal the deal without a significant cash down payment.

Eligible service members and veterans can apply for home-purchase loans via private-sector lenders. There are no VA loan limits for veterans who have the full entitlement. For a VA-backed home loan, you’ll still need to meet your lender’s credit and income loan requirements in order to receive financing. These VA home purchase loans can be used to buy manufactured homes or homes under construction in some cases, but not mobile homes.

The VA loan program also offers cash-out refinance loans.

An Interest Rate Reduction Refinance Loan may be able to reduce the rate on an existing VA-backed loan or can make the payments more stable by moving from an adjustable or variable interest rate to a fixed rate.

VA loans have fees that vary by loan type and veteran status. Veterans using the benefit for the first time on a no-down-payment purchase loan pay a 2.15% fee, for example, while a veteran making a second cash-out refinance loan would pay a 3.3% fee. The VA has a full fee table available.

Veterans who receive or are eligible for VA disability compensation, Purple Heart recipients, and sure others are exempt from fees. The VA can also back other loans, including joint loans, construction loans, and loans to cover the cost of energy-efficient repairs. Consult your lender for more information.

VA loan eligibility does not expire, though the entitlement can only be used for the borrower’s place of residence (not a rental property). It can be reinstated after the loan is paid off or under other circumstances — another veteran can assume the loan, for instance.

Whether current or former troops are eligible for VA loans depends on how long they served and in which years.

Older veterans qualify for VA loans if they served on active duty for at least 90 days during the following dates:

• Sept. 16, 1940- July 25, 1947
• June 27, 1950-Jan. 31, 1955
• Aug. 5, 1964- May 7, 1975 (began Feb. 28, 1961, for those who served in Vietnam)

If a person’s service falls outside of those date ranges, they may need 181 continuous days on active duty to qualify. That includes enlisted troops who separated on or before Sept. 7, 1980, and officers who separated on or before Oct. 16, 1981.

If a person’s service came after the above date ranges, they need 24 months on active duty — or less for certain discharges.

For loan purposes, VA considers Gulf War service to run from Aug. 2, 1990, through the present day. Service members from that time must have completed 24 months of continuous active duty service to be eligible or at least 90 days for certain discharge statuses.

Troops who are currently on active duty become eligible for a VA loan after 90 days of service, for as long as they remain active. Eligibility now includes National Guard and reserve members with at least 90 days of active service. Troops discharged for a service-connected disability are eligible, regardless of service length.