A guide to the types of VA loans

For many veterans and current service members, applying for a VA loan can be a great way to buy a home, as it offers no-down-payment options and flexible financial requirements. Whether you’re buying your first home or refinancing, there are several types of VA loans available to suit your goals.

We’ll guide you through the main types of VA loans, their benefits, and who qualifies for these loans, so you can choose the loan that meets your needs.¹

Key takeaways:

• VA loans are government-backed loans for qualified veterans, active service members, and surviving spouses.
• The main VA loan types include VA purchase loans, VA cash-out refinance loans, IRRRLs, and NADLs.
• Some benefits of VA loans include no-down-payment options, flexible financial and credit score requirements, and lower interest rates.

How do VA loans work?

VA loans are government-backed loans, guaranteed by the Department of Veterans Affairs (VA). You still apply for this loan through a bank, credit union, or online lender, unless it’s a Native American Direct Loan (NADL).

Government-backed loans lower the risk for lenders, allowing them to offer better loan terms and more flexible financial requirements. As of 2025, the VA backs 25% of the loan – called a loan entitlement – which means a lender can recover a portion of their losses if you default on the loan.

A VA loan entitlement is the amount of the loan the VA backs for an eligible borrower. You can generally buy a home with no down payment if you have full entitlement. If you’ve already used part of your entitlement on another VA loan, you may need to make a down payment.

In addition to the no-down-payment requirement, some other benefits of a VA loan include no private mortgage insurance (PMI), flexible credit score and financial requirements, and competitive interest rates.

Next, we’ll cover the types of VA loans, so you can find one that matches your goals, whether you’re buying, refinancing, or renovating.

What are the different types of VA loans?

There are several VA loan products available for eligible borrowers. Let’s look at each type and when each may work best for you.

VA purchase loan

A VA purchase loan is the standard loan type for buying a primary residence with VA benefits. Eligible VA borrowers can buy a home with no down payment, making the pathway to homeownership easier. VA loans typically have better loan terms and rates compared to conventional loans.

As with most VA loans, you’ll have to meet eligibility criteria, and the home must meet VA minimum property requirements. Many lenders also offer fixed-rate or adjustable-rate mortgages (ARM), although terms vary.

VA cash-out refinance

A cash-out refinance allows a homeowner to tap into their home equity by replacing their existing mortgage with a new, larger mortgage. They receive the difference as a lump-sum cash payment, which can be used in various ways, like paying off debts or funding home improvements. Since the new loan is larger, your monthly payments and interest rate will likely change.²

While traditional cash-out refinances only let borrowers access 80% of their home equity, a VA cash-out refinance allows you to access 100% of your home equity. If you meet the requirements, you don’t need to have a VA purchase loan to get a VA cash-out loan.

To get an idea of what a cash-out refinance looks like, let’s say your home is worth $400,000. You have $100,000 of equity, so you still owe $300,000 on your mortgage. If you get a new mortgage for $350,000, then you would receive $50,000 in cash, minus closing costs and the funding fee.

VA interest rate reduction refinance loan (IRRRL)

A VA interest rate reduction refinance loan (IRRRL), also called a VA Streamline Refinance, is a type of loan that can help lower your interest rate, switch from an ARM to a fixed-rate mortgage, or reduce your monthly payment.³

With an IRRRL, there’s no appraisal required, minimal documentation, a simplified underwriting process, and potentially no closing costs. Keep in mind that you must have an existing VA loan to get a VA Streamline Refinance.

Native American Direct Loan

The Native American Direct Loan (NADL) is available to qualified service members and their surviving spouses, as long as they’re part of a federally recognized tribe. Eligible borrowers can use this loan to buy a primary residence on tribal land.

Like other VA loans, NADL mortgages allow you to finance the full purchase price of the home with no down payment, unless required by your lender. Rocket Mortgage does not offer this loan program at this time.

VA renovation loan

A VA renovation loan is an option for qualified borrowers to purchase and renovate their home. This loan type isn’t very common, and many lenders, including Rocket Mortgage, don’t offer a VA renovation loan. Keep in mind that this loan can only be used for repairs or updates that improve safety or reliability, such as replacing heating and cooling systems or making accessibility improvements.

Who qualifies for a VA loan?

Eligibility is based on military service or surviving-spouse status. To obtain a VA loan, you must qualify as one of the following:

• Active-duty, National Guard, or reserve service members who have served for at least 90 continuous days.
• Veterans who meet certain minimum length-of-service requirements.
• Active-duty military members or veterans with disabilities connected to their service.
• Surviving spouses of military service members who died while on active duty.

You’ll also need to meet your lender’s credit and income requirements, which aren’t set by the VA. The home you’re purchasing must be your primary residence, not a vacation or investment property.

You must have a Certificate of Eligibility

To obtain a VA loan, you’ll need a VA certificate of eligibility (COE) verifying your status as a qualifying service member or surviving spouse. You can get your COE from the Department of Veterans Affairs. Note that there may be additional VA loan requirements for surviving spouses.

The property must meet certain requirements

The VA has minimum property standards (MPRs) that a home must meet to ensure it’s safe and structurally sound. A VA-approved appraiser will check that the home meets these standards and that the home value aligns with government-issued guidelines. If the appraisal doesn’t meet these standards, your lender may not issue you the loan.

What to know about the VA funding fee

A VA funding fee is a one-time fee paid to the Department of Veterans Affairs for your VA loan. The government sets this fee, and it’s subject to change based on legislation. The amount you pay on the funding fee depends on your down payment amount and whether you’ve used a VA loan before.

For first-time borrowers with a 0% – 5% down payment, the fee is typically 2.15%. For repeat borrowers with a 0% – 5% down payment, the fee is usually 3.3%. Keep in mind that if your down payment is above 5%, the funding fee is often lower.

Typical VA funding fee amounts

Your funding fee depends on your VA loan type, down payment amount, and how many VA loans you’ve had.

Let’s look at the funding fee ranges:

Funding fee waivers are available

You may be able to obtain a waiver to avoid paying the VA funding fee if you have a service-related disability or meet another requirement. Contact the Department of Veterans Affairs if you have questions about your eligibility for a VA funding fee waiver.

FAQ

What are the VA loan limits?

VA loan limits are the same as the Federal Housing Finance Agency (FHFA) limits. For 2026, the limit is $832,750 in most places, and $1,249,125 in higher-cost areas. You can check your county’s loan limits on the HUD website.

Which type of VA loan is right for me?

If you’re buying an eligible primary residence, then a VA purchase loan is the right option. If you already have a VA loan and want better loan terms, an IRRRL is likely the best fit. However, if you want to refinance and tap into your home equity, a VA cash-out refinance may be a better option. Lastly, an NADL can be a good choice if you qualify for the program.

Do VA loans require a down payment?

No, VA loans don’t require a down payment as long as you have your full entitlement. If you’ve previously used some or all of your entitlement, you may need a down payment for your next home.

Can I use a VA loan to finance any type of real estate?

No, VA loans can only be used for primary residences, not secondary or vacation homes. You can purchase a single-family home up to four units, a VA-approved condo, a home to renovate, a manufactured home, or a new house.

The bottom line: Veterans have many options for loans

As a veteran or active-duty service member, there are plenty of VA loan options available to help make homeownership more affordable. It’s a good idea to research all your options before applying for a loan, but knowing the difference between VA loan types is a great starting point.

If you’re ready to buy a home or refinance your VA loan, you can begin the mortgage application process with Rocket Mortgage.

¹Rocket Mortgage is a VA-approved lender, not endorsed or sponsored by the Dept. of Veterans Affairs or any government agency

²Refinancing may increase finance charges over the life of the loan.

³The VA Streamline program may have stricter requirements in some states. In order to qualify for the VA Streamline program, you must have a VA loan. The VA Streamline is only available on primary residences. Cash-out transactions are not allowed. In order to qualify for a VA Streamline, a 0.5% minimum reduction in interest rate on the previous fixed-rate loan must occur if the new loan will be a fixed rate or a 2% minimum reduction in interest rate on previous adjustable rate mortgage loan must occur; a minimum of 6 months of consecutive mortgage payments must be paid on the current loan at the time of application. Some states may require an appraisal. Additional restrictions/conditions may apply.

Rocket Mortgage is a trademark of Rocket Mortgage, LLC or its affiliates.