Best VA Loans for December 2024

A VA loan is a mortgage loan guaranteed by the U.S. Department of Veterans Affairs. Eligible borrowers can enjoy several perks, including no down payment or mortgage insurance requirements, and lower rates than other types of mortgages. If you’re considering a VA loan for your home purchase, this guide can help point you in the right direction.

Best VA loans compared

*APR accurate as of Feb. 20, 2024, 30-Year Fixed VA Purchase Loan.

Our recommendations for best VA loan providers

Best for low APR: PenFed Credit Union

APRs for VA loans tend to be lower than other types of loans, but PenFed Credit Union takes it further by offering APRs as low as 6.278%—the only lender on our list with an APR under 6.5%. However, PenFed doesn’t consider alternative credit data, so those with thin credit files may need to look elsewhere for their home loans. Closing can take between 30 and 45 days.

To get a VA loan from PenFed, you must be a credit union member. This adds an extra step to the application process, but membership has a number of perks that make it worthwhile. These include member discounts on auto and home insurance, tax filing, home security, and shopping.

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Best for online lending: Rocket Mortgage

Rocket Mortgage is a premier online mortgage lender offering numerous financial products, including VA loans. The lender accepts borrowers with credit scores as low as 580 and DTI ratios as high as 60%, making it easier to qualify for a VA loan. If your application is approved, you can access loan information 24/7 through the user-friendly Rocket Mortgage app.

Rocket Mortgage doesn’t offer any home equity lines of credit (HELOC), which could rule it out for some borrowers. There are also no physical locations, which may not be an issue for those who are comfortable with doing business online but could be a downside for some.

Rocket Mortgage’s starting APR for VA loans was 7.185% as of Feb. 20, 2024. You can expect to close in around 47 days.

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Best for fair credit: New American Funding

New American Funding reportedly accepts VA loan applicants with credit scores as low as 580. Many lenders require a higher credit score of 620 and up, making New American Funding a solid choice for those with fair credit scores. New American is also one of the top lenders for Latino borrowers through the Latino Focus initiative, which has a commitment to fund $2 billion in loans to Latino customers in 2024.

The APR for New American Funding’s VA loans starts at 6.563%, though the lender doesn’t specify an average closing time. Unfortunately, you’ll need to submit your contact information to get a rate quote, which could lead to incessant emails or calls.

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Best for refinancing: USAA

USAA has three different VA refinancing options: a cash-out refinance, an interest rate reduction refinance loan (IRRRL), and a jumbo IRRRL. Eligible borrowers with a home loan can take advantage of one of these options to lock in a lower interest rate or get cash equity to fund a home improvement project, pay for college, or cover an unexpected expense. However, USAA doesn’t offer home equity options (such as a loan or line of credit) beyond the cash-out refinance.

To get a VA loan from USAA, you must be a USAA member, which adds an extra step for those without membership. However, becoming a member is free and USAA membership comes with numerous perks, including travel, car rental, and shopping discounts.

As of Feb. 20, 2024, a VA loan from USAA had a starting APR of 6.835%. Closing times for USAA VA loans are not specified on its website.

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Best for loan choices: Veterans United

Veterans United offers several VA loan choices. Fixed VA purchase loans come with terms of 20 or 30 years, and you can get a 30-year fixed VA jumbo loan for more expensive home purchases. There are also several options for refinancing, including a 30-year cash-out refinance and a 30-year streamline, or IRRRL, refinance. Both refinance options are available for jumbo loans.

Veterans United also offers 24/7 customer support, so you can reach out with questions whenever you have them. Additionally, the lender’s network of real estate agents has experience working with military members and veterans. Using one of these agents could help you save money on closing costs.

A Veterans United VA loan can close in around 35 days, at a current starting APR of 6.050%.

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Best for home-buying tools: Guaranteed Rate

Searching for a home can be stressful. Guaranteed Rate has several tools to help take the sting out of the process, including housing market research and home valuation tools. The website also has an extensive library of financial education resources, including a first-time homebuyer course that covers the steps involved.

Guaranteed Rate may consider alternative credit data for VA loan applicants, such as utility and rent payments. This allows Guaranteed Rate to approve loans for borrowers with credit scores as low as 580. Guaranteed Rate can close home loans in as little as 21 to 30 days, with current APRs starting at 6.675%.

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Best for rebates: Navy Federal Credit Union

If you get a VA loan from Navy Federal Credit Union and work with one of its affiliated real estate agents,, you could be eligible for a rebate of up to $9,000. The exact rebate amount will depend on the home's purchase price, with more expensive homes getting a higher cash-back amount.

Navy Federal Credit Union also offers a Rate Match Guarantee—if you find a lower rate elsewhere, Navy Federal will match it or give you $1,000. VA loan closings take around 30 days, and the APR is currently only 6.558%.

You’ll need to be a Navy Federal Credit Union member to get a loan, but that membership gives you access to numerous offers and deals that can save members hundreds of dollars per year.

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Methodology

To develop this list of the best VA loans, we looked at a number of loan providers to determine their offerings, rates, and credit score requirements. We compared the top lenders, looking for the lowest rates and any additional perks available to borrowers, such as financial tools and real estate services. Once we had our finalists, we listed their pros and cons to determine each lender's biggest strength.

How to select the best VA loan provider

When searching for a VA loan provider, one of the most important things to check is the lender’s credit score requirements. While some lenders will accept scores as low as 580, many require borrowers to have a credit score of 620 and up. If your credit score falls within this range, you should check with the lender to ensure they will work with you.

The best way to choose a VA loan provider is by comparing rate quotes from several lenders to see which ones offer the best APR and additional perks. If you prefer a specific lender, but the rates are lower elsewhere, try using the lower rate quote to get a lower rate with your preferred lender.

Alternative to VA Loans

Just because you’re eligible for a VA loan doesn’t mean you must go this route. There are several other types of mortgage loans you may want to consider, including conventional, FHA, and USDA.

Let’s explore how each of these compares to a VA loan.

VA loan vs. conventional loan

A conventional loan is a type of mortgage with no special eligibility requirements. Conventional loans are conforming, meaning a loan limit is set by mortgage buyers like Fannie Mae and Freddie Mac. Loans that exceed this limit are non-conforming and are considered jumbo loans. The table below explains the main differences between VA and conventional loans:

VA loan vs. FHA mortgage

An FHA mortgage is a type of home loan guaranteed by the Federal Housing Administration. Like a VA loan, the FHA guarantee means that the lender will be repaid in part or full if you default. The following table breaks down the differences between the two types of loans:

VA loan vs. USDA mortgage

A USDA loan is another type of government-backed mortgage, but the United States Department of Agriculture guarantees this one. The USDA loan program aims to help borrowers buy homes in rural areas. The following table explains the differences between the two types of home loans:

More about VA loans

What is a VA loan?

A VA loan is a type of mortgage guaranteed by the U.S. Department of Veterans Affairs. The VA doesn’t lend the money; private lenders do that. However, the VA guarantee means the government will repay the loan in part or full if the borrower defaults. This guarantee makes getting a home loan easier for service members and other eligible individuals.

How does a VA loan work?

Qualified borrowers can get a VA loan with no down payment or requirement for private mortgage insurance (PMI). VA loans also tend to have lower interest rates than conventional loans, saving borrowers money over the loan duration.

VA loans have a funding fee requirement equal to 2.3% of the loan amount for first-time borrowers and 3.6% for repeat borrowers. This fee can be rolled into the total loan amount, allowing you to repay it over the loan term rather than at closing.

VA loan pros and cons

Before deciding to move forward with a VA loan, consider the pros and cons of this type of mortgage, as per the following table:

Types of VA loans

Veterans Affairs provides guarantees on the following four loan types:

• Purchase loan: A purchase loan loan is intended for borrowers looking to purchase, build, or improve a home.
• Native American Direct Loan (NADL): Veterans who are Native American or have a Native American spouse can qualify for an NADL, which helps borrowers purchase, build, or improve a home on federal trust land.
• Interest rate reduction refinance loan (IRRRL): This VA streamline refinance loan is intended to help eligible borrowers refinance their existing mortgage at a lower interest rate.
• Cash-out refinance loan: A borrower can apply for a cash-out refinance loan to replace an existing mortgage while tapping into their home equity.

VA loan requirements

To qualify for a VA loan, you must be able to meet all of the following requirements:

• Be a U.S. service member, veteran, or surviving spouse.
• Meet the requirements for length of service.
• Be a U.S. citizen or permanent resident.
• Meet the credit score requirements set by the lender (typically 620 and up, though some lenders accept borrowers with lower scores).
• Plan to live in the property permanently as a primary home.

How to apply for a VA home loan

Before applying for a VA loan, you must acquire a Certificate of Eligibility (COE), which shows potential lenders that you are eligible for this type of loan. Veterans must provide a copy of their discharge or separation papers, while active service members must provide a statement of service. Eligible surviving spouses must provide a copy of the veteran’s discharge papers, marriage license, and death certificate.

Once you have the COE, you can apply for a VA loan through your chosen lender. The process is similar to applying for a conventional or other mortgage loan. You must provide your personal information and COE; the lender will run your application. This involves pulling your credit report, reviewing your debt-to-income (DTI) ratio, and your income.

TIME Stamp: A VA loan offers significant advantages to eligible borrowers

Compared to most standard loans, VA mortgages have many benefits for those who qualify, including no down payment or mortgage insurance requirement, and lower rates. If you are eligible for a VA loan, the best lenders in this guide provide an excellent starting point to gather and compare rates and terms.

Frequently asked questions (FAQs)

What are current VA mortgage rates?

VA mortgage rates vary from lender to lender. Currently, the rates of the lenders on our list range from 6.278% APR to 7.185% APR. Rates are subject to change, so it’s important to double-check with a lender before applying or to request rate quotes from several lenders and compare them to find the best fit.

What is the VA loan funding fee?

The VA loan funding fee is a one-time fee that the VA borrower must pay upon closing. The fee can be paid upfront as a closing cost or rolled into the loan balance and repaid over the loan term.

The funding fee depends on the down payment and whether it’s your first VA loan. If you’re using a VA loan for the first time, your funding fee will range between 1.25% and 2.15%, depending on how much you put down. After the first use, it’ll range between 1.25% and 3.3%.

What is the current VA loan interest rate?

The current VA loan interest rates range from 6.00% (6.278% APR) to 6.875% (7.185% APR) for a 30-year fixed rate mortgage. These rates are not guaranteed, and the rate you’re offered may be higher based on your credit score and other factors.

Can you buy land with a VA loan?

Yes. You can purchase land with a VA loan, but not all lenders will approve this type of loan. To use a VA loan to purchase land, you must also be constructing a new home on that land.