How a VA loan works
Who makes the loan, what the VA does, what you pay, and the steps from first call to closing.
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At a glance
- A private lender usually makes the loan
- The VA backs it
- You still qualify with the lender
- You live in the home
Talk with a licensed loan officer
Questions, answered
Does the VA give me the loan?
For most VA-backed loans, no. A private bank or mortgage company makes the loan, and the VA backs it.
Does the VA approve my loan?
The VA decides your eligibility for the benefit and sets program standards. Your lender reviews your credit and income and decides on the loan.
Do VA loans have mortgage insurance?
VA-backed purchase loans don't require private mortgage insurance or mortgage insurance premiums. You may need to pay a one-time VA funding fee instead, unless you're exempt.
Can the seller pay my closing costs?
They can. The VA doesn't limit credits for a loan's closing costs, but it limits seller's concessions to 4% of the home's reasonable value.
Can I pay a VA loan off early?
Yes. The VA says there's no penalty fee for paying the loan off early.
Can I use a VA loan more than once?
Yes, you may be able to. It depends on your remaining entitlement and whether it has been restored.
More answers in the FLO Mortgage VA FAQ.
Who does what
| You | Request your Certificate of Eligibility, or ask your lender to. Apply with a lender and live in the home. |
|---|---|
| The VA | Reviews your eligibility and backs the loan. The VA also sets standards for credit, income and the property. |
| Your lender | Requests the VA appraisal, reviews your credit and income, and works with you on closing. Lenders can add their own requirements. |
What you pay
- Interest. Your lender charges interest on the loan.
- Closing costs. On a purchase, you can finance only the VA funding fee. You pay other fees and charges at closing, and the seller may pay some of them. See VA closing costs and seller concessions.
- VA funding fee. You may need to pay this one-time fee, or finance it into the loan. Some borrowers are exempt, including those receiving VA compensation for a service-connected disability. Try the funding fee calculator.
Down payment
With full entitlement, the VA sets no cap on how much you can borrow without a down payment, as long as the sales price isn't higher than the appraised value. You still have to qualify for the payment, and a lender can set stricter rules. If you have an existing VA loan or entitlement that hasn't been restored, you may need a down payment. Read about entitlement.
The steps, start to finish
- Get your COEYou or your lender request it, and the VA reviews your service.
- Apply with a lenderThe lender reviews your credit and income against VA and lender standards.
- Get the VA appraisalThe lender requests an appraisal, which covers value and VA property requirements.
- Close and move inYou and the lender choose a title company or other closing agent, then you sign and move in.
The VA home buying roadmap covers each step in detail, and VA loan requirements lists what you need to qualify.
Sources: VA.gov purchase loans, VA.gov how to apply and VA.gov funding fee and closing costs, and VA.gov loan limits.
More VA loan guides
- VA home loans overview
- VA loan questions, answered
- VA loan tools and calculators
- VA loan requirements
- VA Certificate of Eligibility
- VA home buying roadmap
- VA loans for first-time buyers
- VA loans for active duty
- VA loans for Guard and Reserve
- VA appraisals and property requirements
- VA closing costs and seller concessions
- VA occupancy rules
- VA entitlement and second VA loans
- Assumable VA loans
- VA condos and property types
- Disabled veteran property tax exemptions
- VA streamline refinance (IRRRL)
- VA cash-out refinance
- VA funding fee exemption
- VA loans for surviving spouses
- VA residual income explained
- VA loans after bankruptcy or foreclosure
This is not a commitment to lend. All loans are subject to credit approval, underwriting guidelines, property eligibility and program availability. Lender requirements may be stricter than the program guidelines described here. Not all applicants will qualify. Figures reflect 2026 VA guidelines and may change without notice. FLO Mortgage, LLC, company NMLS #1835856. Licensed mortgage lender in Florida (MLD2621), Georgia and Tennessee. Equal Housing Opportunity. FLO Mortgage is not affiliated with or endorsed by the U.S. Department of Veterans Affairs or any government agency. Licensing & Disclosures.
Local, licensed help
Talk a VA loan through with a FLO loan officer
Every FLO Mortgage loan officer can walk you through this program, run the numbers for your situation and compare it with your other options. Have questions? Call our main office at (386) 882-9980.
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