Categories Of Residential VA Loans

Mortgage loans funded in the United States that are guaranteed by the U.S. Department of Veteran Affairs are known as VA Loans.

These loans were developed to offer long-term, affordable home financing to eligible American veterans or their surviving spouse (except in cases of remarriage). The VA home loan program's basic intent was to provide military service-members easy access to home financing when private sector financing was not typically available, and to aid veterans with the ability to purchase property with no money down.

There are four distinct VA loan types. They are the VA IRRL, VA Refinance, VA Purchase, and finally, the VA Vendee loan. All VA loans are guaranteed by the VA.

VA Vendee loans are very different than the other three. It is used to purchase investment property as opposed to property the borrower will occupy and the only VA loan open to civilians. Offered to veterans and non-veterans, the VA Vendee loan is used to aid with the purchase of multi-family REO income producing properties.

The VA purchase can be financed with as little as O% down, and a non-owner occupied VA Vendee purchase can be financed with as little as 5% down. The VA IRRL stands for Interest Rate Reduction Loan. The purpose is to refinance a VA loan with a new VA loan to lower payment, interest rate or both. The VA refinance allows a borrower to cash out equity and/or rehab or remodel a property. For the VA refinance, the original loan can be any type of loan or a property owned free and clear.

All VA loan types will allow for $6,000 of energy efficient improvements to be financed into the loan.

All refinance types and the $0 down VA purchase require the borrower to certify that they intend to occupy the property as their primary residence. This means the Veteran/borrower will state that they plan on living (or currently do live) in the property as thier main home. However, there is also no formal time frame occupancy requirement with a VA loan. Many times veterans struggle in cases where they are unable to sell their current home and desire to rent it out and buy another home. Because of this, VA loans allow you to use the benefit more than once. However, the $0 down VA home loan is intended to be used for a persons primary home, and you must request and qualify to have more than 1 VA loan at a time.

Usually, a VA loan offers the most advantages when compared with other mortgage types. We hope this guide will help you better understand the VA loan process and help you determine which VA loan is the right one for you.


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Find out why VA home loans are superior to all other mortgages. To learn more about VA loans, visit VA HLC @ http://www.VAHLC.org - Author Philip Georgiades San Diego VA HLC.