The official VA Home Loan was originally known in 1944 as the Servicemen’s Readjustment Act or (the GI Bill of Rights). This GI Bill became law by way of President Franklin D. Roosevelt signing it. The law provided United States veterans to purchase a federally insured or guaranteed home with no down payment. This zero down feature was designed to provide home ownership assistance for the millions of veterans and their families. It allowed the dream of home ownership to became a reality for veterans. This one act of signing the GI Bill contributed more than any other military program in history to the welfare of United States veterans and their families, thus allowing the nation’s economy to grow.The VA home loan has been extremely popular and advantageous to the more than 29 million veterans and service personnel eligible for VA financing. The VA loan has eligibility requirements, which are defined as US veterans who have served on active duty and have an honorable discharge after serving a minimum of 90 days of wartime or a minimum of 181 continuous days during peacetime. The Department of Veterans Affairs has a two-year requirement if the US veteran enlisted and began service after September 7, 1980 or was an officer and began service after October 16, 1981. The requirements are different for National guards and reservists where there is a six-year requirement with certain criteria. In addition, there are specific rules concerning the eligibility of surviving spouses of veterans.


The Department of Veterans Affairs will guarantee a maximum amount of 25 percent of a VA home loan up to $104,250, which puts a limitation on the maximum loan amount to $417,000. The rule allows the Veteran to borrow the appraised value of the property (reasonable value accessed by the VA appraiser) or the purchase price, whichever is less, plus the VA funding fee of 2.15% of the loan amount (2.40% for reservists). All veterans must qualify financially and have good credit as defined by the VA, as they are not automatically eligible for the program.

Veterans Affairs (VA) guaranteed home loans are made by numerous private lenders, such as credit unions, savings & loans, banks or mortgage companies to eligible US veterans for the purchase of a single family (1-4 unit) home. The veteran must use the property for his or her own personal occupancy. The VA home loan guaranty means the lender is protected against loss if you or a later owner fails to repay the loan. The money charged for the funding fee allows the VA to guaranty and protect the lender from the first 25 percent of the value of the home. This guaranty allows you to obtain favorable financing terms