Is a VA Loan Right for You? 9 Questions to Ask First

VA Loans: A Unique Benefit Worth Exploring

VA loans continue to be one of the most appealing options for eligible veterans, active-duty service members, and surviving spouses looking to purchase a home. With advantages like no down payment, competitive interest rates, and no private mortgage insurance (PMI), they’re designed to simplify homeownership. But just because VA loans offer powerful benefits doesn’t automatically mean they’re the right fit for everyone.

Before you jump in, it’s smart to assess your financial goals, timeline, and circumstances. These nine questions will help you evaluate whether a VA loan lines up with your plans—and how to maximize it if it does.

Are You Eligible for VA Loan Benefits?

It all starts here. You need to meet certain service requirements to qualify for a VA loan. These generally include:

• Being a veteran with an honorable discharge
• Currently serving active duty
• Having sufficient service in the National Guard or Reserves
• Being a surviving spouse of a service member who died in service or from a service-connected disability

You’ll need a Certificate of Eligibility (COE) to prove your qualification, which lenders can help you obtain. Without eligibility, the rest of the loan features don’t apply—so this is step one.

Is a Down Payment Holding You Back?

One of the standout features of VA loans is the zero down payment. For many buyers, especially first-timers, this is a game-changer. Conventional loans typically require 5% or more down, and even FHA loans require 3.5%. VA loans let you purchase a home with no upfront cash beyond closing costs.

If saving for a down payment has been your biggest hurdle, a VA loan could remove it entirely—making homeownership possible sooner.

Do You Want to Avoid Private Mortgage Insurance (PMI)?

Unlike most low-down-payment mortgages, VA loans never require PMI. This can save you hundreds each month, especially over the long term. PMI is typically required until you reach 20% equity in a conventional loan. VA loan holders skip that expense from day one.

If your goal is to keep monthly costs predictable and affordable, the absence of PMI is a major plus.

Is Your Credit Score a Work in Progress?

While lenders usually prefer scores around 620 or higher for VA loans, the requirements are still more flexible than conventional options. The VA itself doesn’t set a minimum score. Instead, lenders assess your overall financial profile—including income, debt-to-income ratio, and payment history.

If your credit isn’t perfect but you’re responsible with finances, you may find the VA route more accommodating than traditional loans.

Are You Planning to Use the Home as Your Primary Residence?

VA loans come with occupancy rules. You must intend to live in the home as your primary residence shortly after closing (typically within 60 days). That means:

• No vacation homes
• No investment properties (unless it’s a multi-unit home and you live in one unit)

If your goal is to buy and hold a rental without living in the home, VA loans won’t support that plan. But if you’re ready to move in, they’re a solid fit.

Do You Have Stable Income and Manageable Debt?

Although VA loans are flexible on credit, they still assess your ability to repay the mortgage. Most lenders look for a debt-to-income (DTI) ratio under 41%, though exceptions are made with strong compensating factors.

If you have a steady job and manage your existing debt responsibly, you’ll likely qualify with ease. And because VA loans don’t penalize you with balloon payments or prepayment penalties, they work well for long-term financial planning.

Are You Comfortable with the VA Funding Fee?

VA loans don’t require PMI or down payments—but they do come with a funding fee. This one-time cost helps sustain the VA loan program and ranges based on loan type, service history, and whether it’s your first use of the benefit.

Key points:

• The funding fee can be rolled into your loan
• Veterans with a service-connected disability are exempt
• It’s lower than PMI over time, but still worth factoring into your costs

Understanding this fee helps you budget accordingly and prevents surprises at closing.

Do You Plan to Stay in the Home for a While?

VA loans are best for long-term occupancy. If you’re buying a home to flip in six months or planning to relocate soon, a VA loan might not be ideal. Although you can sell and reuse your entitlement, moving frequently makes the costs harder to justify.

Ask yourself:

• Is this a 3+ year plan?
• Is the home suited to future needs (family size, work commute)?
• Would refinancing be needed soon, and is that worth the effort?

The longer you stay, the more you benefit from the VA loan structure.

Have You Compared VA Loans to Other Mortgage Options?

Even if you qualify, it’s smart to compare Va Loans against conventional and FHA products. In some cases—especially with larger down payments—a conventional loan could offer comparable rates without the funding fee.

Questions to ask:

• How do rates and fees compare?
• Would PMI cost more than the VA funding fee?
• Are there lender incentives that tilt the scales?

Shopping around ensures you choose the mortgage that matches both your finances and future plans.

Final Thoughts: Know Before You Borrow

VA loans can unlock homeownership with incredible advantages—but like any financial tool, they’re most effective when used with intention. If you’re eligible and ready to put down roots, these loans can offer unmatched flexibility, affordability, and protection.

By asking the right questions upfront, you can move forward with confidence, avoid delays, and make your home purchase one of your smartest investments yet.