VA Loans: 5 Common Myths Busted - Northern Title Blog
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VA Loans: 5 Common Myths Busted

VA Loans: 5 Common Myths Busted

According to the most recent report from the US Census Bureau, there are over 18.2 million veterans residing in the nation. However, only a small percentage of them have a VA home loan. With so many benefits to a VA loan, more vets ought to be taking advantage of this. But why aren’t they? Here’s a list of myths about VA home loans we’ve busted:

Myth #1: VA Loans are Too Hard to Get

Contrary to what many people think, VA loans are not difficult to get as they are issued by private lenders (like credit unions, banks, or mortgage companies) and are backed by the U.S. Department of Veterans Affairs (VA). In short, the VA provides insurance to lenders, assuring banks and mortgage companies that the loan will be repaid should a veteran be unable to make payments. This program, established in 1944, aims to assist those who have served to purchase a home at great terms and rates.

Eligibility for a VA loan is based on the length of time served, and the period in which you served. To see if you’re eligible, you’ll need a DD Form 214. With the form, a VA-approved lender can request your VA Certificate of Eligibility for you, or you can request it directly from VA’s eBenefits website. Even if you served decades ago, you may still be eligible. 

VA loans are available to U.S. veterans, active-duty service members, National Guard members, reservists and in some cases- even eligible spouses.

Myth #2: You Need a Great Credit Score for a VA Loan

Actually, one of the greatest benefits of a VA home loan is the fact that you don’t need an excellent credit score. In addition, the VA loan is a $0-down mortgage option, meaning you don’t have to throw down a down payment like you typically do with FHA or Conventional loans. Even if you have a history of bankruptcy or foreclosure, you may still be eligible. 

Myth #3: I Already Used a VA Loan Once

Another advantage of a VA home loan is your benefit never expires, so you can use your eligibility over and over again. So long as the property you’re purchasing is your primary residence, VA loans can be used multiple times. In addition, even if you don’t currently have a VA loan, you can refinance with a VA loan and still experience the benefits it offers.

Those who take advantage of refinancing with a VA loan can use the IRRRL to drop their rate (and payment) without requiring an appraisal or common documents like paystubs, W2s or bank statements. This not only helps homeowners save money, but it is a much faster process than common refinancing options. 

Myth #4: It Will Cost Me in Fees

While there is a mandatory VA Funding fee (which helps keep the VA program in existence and ranges between .5%-3.3% of the loan), it doesn’t compare to the amount of money you end up saving from a $0 down payment and eliminating monthly mortgage insurance premiums. Avoiding these monthly fees can save you hundreds of dollars each month. (Disabled veterans who are receiving compensation for a service-connected disability are exempt from the VA Funding Fee.)

Additionally, veterans are more likely to secure better rates with a VA loan (typically about .25% lower than conventional loans). And because VA loans don’t have any prepayment penalties, homeowners can make extra payments toward the principal any time, shaving years off the back end of your mortgage, and saving you thousands of dollars overall.  

Myth #5: I’m Limited to Certain Properties

While it’s true that you can’t use a VA loan on a farm or a downtown shop, you can still use it towards properties that are a little more “move-in ready” such as single family homes, multi-unit properties, manufactured homes, and condominiums. The VA website provides a list of thousands of condos across the nation that may be ideal starter homes, and are often more affordable than a single family home. 


VA loans are an excellent way to help those who have served our country secure a home at an affordable rate and move forward. Contact us at Northern Title with any questions about VA loans you may have.