In January of this year, a new law governing mortgages backed by the Department of Veterans Affairs went into effect, allowing those using VA loans to borrow any amount of money (as long as they qualify) with no down payment. Zero-down payment loans were previously capped at the same level as conforming loans. Many loans can also be refinanced as a result of the new program.

Rates for VA loans are 1/8 to 1/4 lower than conventional loans and do not require private mortgage insurance. They also typically have more flexible debt-to-income standards compared to conventional mortgages, but home purchases must pass a VA-loan appraisal, which has stricter criteria than a conventional home-loan appraisal.

In 2019, VA loans accounted for about 10% of all loans written for home purchases, up from about 2% prior to the recession. The increase is due in part to improvements in how VA loans are administered.

Many veterans are surprised to learn that a majority of the 1.34 million active military personnel and 18 million veterans qualify for VA loans and that VA loan programs can be used each time a home is purchased or refinanced.

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