Definition
A home loan for eligible veterans, service members and some surviving spouses, guaranteed by the Department of Veterans Affairs.
What it means
VA home loans are made by private lenders and partly guaranteed by the U.S. Department of Veterans Affairs. Eligible borrowers can often buy a home with no down payment and no private mortgage insurance, and VA rules limit some closing costs. Most borrowers pay a one-time VA funding fee, which depends on the type of loan, whether it is a first or later use, and the down payment; veterans receiving VA disability compensation and some others are exempt. You need a Certificate of Eligibility based on your service, which a lender can usually request for you. The home must be your primary residence. VA loans can also be used to refinance, including an Interest Rate Reduction Refinance Loan for existing VA loans.
Example
A veteran buying a $320,000 home with $0 down borrows the full price plus any financed funding fee and pays no monthly private mortgage insurance, which a conventional loan with little or no down payment would usually require.
Illustrative numbers only. Your situation will differ.