What is a VA Loan?
 
A VA loan is home purchase mortgage loan that is insured by the federal government.  (Note that the VA is not the lender, rather the guarantee institution.) The VA loan program is offered to veterans of the United States Armed Forces (including the National Guard and the Reserved) to make the dream of home ownership a reality.
 
VA Mortgage Loans are generally offered at better interest rates than those offered by traditional mortgage lenders.  There may be a small number of available loan programs from which to choose when you select to borrow a VA home purchase loan, but many options are still available to purchasers. These include:
 
¯        15 and 30 Year, Fixed Rate Mortgage
¯        ARM (Adjustable Rate Mortgages)

 Other Benefits of VA Mortgage Programs
 
Unlike traditional mortgages, and even FHA mortgages, VA mortgage programs generally require very little or even ZERO down payment. This allows the home buyer to purchase more home for their money, and to save the initial output of cash generally required for a mortgage loan closing.
 
Private Mortgage Insurance is generally required by traditional mortgage lenders because it protects their interests should the buyer later default on their loan payments.  VA loans do not require PMI because they are guaranteed by the federal government.
 
VA mortgages are able to be assumed by the next purchaser. This means that should you decide to sell your home prior to the home being paid-off, the buyer may be eligible for the same benefits offered to you when you purchased the home.  This is one benefit that is almost NEVER available through a traditional lender. 

Who is Eligible?

Generally, anyone who has served as a member of the United States Armed Forces is eligible to borrow through the VA home purchase mortgage program. However, length of service and discharge type may have a bearing on the type of loan program for which the borrower qualifies and the interest rate offered.