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VA Loans

Last updated: October 2026

Thank you for your service. You earned this benefit, and it works for refinancing as well as buying. The VA IRRRL lowers the rate on a VA loan you already have. A VA cash-out refinance can replace any loan, VA or not, and turn equity into cash.

Find your optionsCall (949) 990-6030

Do I qualify?

Key Facts

  • VA loans are mortgages made by private lenders and backed by the U.S. Department of Veterans Affairs for eligible service members, veterans and surviving spouses.
  • They carry no monthly mortgage insurance at any loan-to-value.
  • A one-time funding fee applies unless you are exempt, and it can be financed into the loan.

What Is a VA Loan?

The Department of Veterans Affairs backs part of the loan. That lets lenders offer terms that wouldn't exist otherwise. There's no monthly mortgage insurance. With full entitlement, there's no required down payment and no VA loan limit. The rules come from Title 38 of the U.S. Code and the VA Lenders Handbook.

Randy Mathis, NMLS# 1516760, arranges VA purchase and refinance loans through Lumin Lending Inc., licensed in 15 states with access to 100+ lenders. I handle everything from requesting your Certificate of Eligibility (COE) to closing. I also shop your file, because lender overlays on VA loans vary widely.

Your entitlement is the part of the loan VA backs, and you can reuse it. Sell the home and pay off the loan, and it's restored. Since January 1, 2020, borrowers with full entitlement have no VA loan limit. With partial entitlement, the county conforming limit factors into how much you can borrow before a down payment applies.

I see this all the time. A veteran uses the benefit once, forgets about it, and ends up paying mortgage insurance on an FHA or conventional loan. A VA refinance can end that. For non-military borrowers, my conventional and FHA programs are the alternatives.

Who Is a VA Loan a Good Fit For?

If you're eligible, VA is usually the first program I price. These are the borrowers it fits.

  • Veterans who meet minimum service requirements and were discharged under conditions other than dishonorable
  • Active-duty service members after at least 90 continuous days of service
  • National Guard and Reserve members with six creditable years or qualifying active-duty service
  • Eligible surviving spouses of veterans who died in service or from a service-connected disability
  • Current VA borrowers who want a lower rate through the IRRRL
  • Veterans with FHA or conventional loans who want to end monthly mortgage insurance or take cash out
  • Veterans with lower credit scores, since VA sets no minimum and VA options below 580 may be available on select programs

How Does Qualifying for a VA Loan Work?

Eligibility. Your COE confirms your service, your remaining entitlement and your funding fee status. I can usually pull it through VA's online lender system.

Credit. VA sets no minimum credit score. Lenders set their own, and VA underwriting focuses on your recent payment history rather than the score alone.

Income. VA uses two tests. Debt-to-income has a 41% benchmark, which is a guideline rather than a hard cap. Residual income, the money left each month after major expenses, must meet a minimum that varies by family size and region. Strong residual income is what gets a higher-ratio file approved.

The property. The home must be your primary residence, one to four units, and you generally move in within 60 days. A VA-assigned appraiser sets the value and checks VA's minimum property requirements.

VA Loan Parameters

ParameterVA (VA Lenders Handbook and Title 38)
Backed byU.S. Department of Veterans Affairs, which backs part of each loan
EligibilityVeterans, service members, qualifying Guard and Reserve members, eligible surviving spouses; confirmed by a COE
Down payment$0 down with full entitlement; may apply with partial entitlement on a larger loan
Loan limitNone with full entitlement since 2020; partial entitlement uses the county conforming limit
Monthly mortgage insuranceNone, at any loan-to-value
Funding feeOne-time; varies by loan type, prior use and down payment; can be financed; exemptions apply
Funding fee exemptionsService-connected disability compensation, Purple Heart recipients on active duty, surviving spouses receiving DIC
Minimum credit scoreNone set by VA; lender overlays vary
Debt-to-income41% benchmark; higher with strong residual income and compensating factors
Residual incomeRequired; minimums vary by family size and region
OccupancyPrimary residence, 1 to 4 units; generally move in within 60 days
Seller concessionsUp to 4% of the home's value, plus normal closing costs
IRRRLVA-to-VA only; 210 days and 6 consecutive monthly payments; costs recouped within 36 months
Cash-out refinanceUp to 100% of appraised value under VA rules (lenders may cap lower); can replace VA or non-VA loans
Reusing the benefitEntitlement restored after sale and payoff; one-time restoration if you keep the home

What Are Your VA Refinance Options?

VA has two refinance paths, and they cover almost every reason a veteran refinances.

VA IRRRL (Interest Rate Reduction Refinance Loan)

The IRRRL replaces a VA loan with a new VA loan at a lower rate, or moves you from adjustable to fixed. VA doesn't require an appraisal or credit underwriting, though many lenders add their own checks. You only certify that you once lived in the home, so it can work on a former residence you now rent out. The law sets two rules. At least 210 days must pass after your first payment was due, with six consecutive monthly payments made. And the costs must be recouped through lower payments within 36 months.

VA cash-out refinance

This one can replace any existing loan, VA, FHA, conventional or non-QM, as long as you're eligible and live in the home. Under VA rules the new loan can reach 100% of the appraised value, though many lenders cap it lower. It's fully underwritten. VA requires the lender to document a net tangible benefit and give you a comparison of the old and new loans.

I use it most for two things. One is pulling equity for debt consolidation or a remodel. The other is getting out of FHA or conventional mortgage insurance, even with little or no cash out. If your first mortgage rate is low and you only need some cash, a HELOC may be the better tool.

A disability rating changes the math

If you receive VA disability compensation, you pay no funding fee on either refinance. That shortens your break-even. Divide the closing costs by your monthly savings to find it, or run it on the refinance calculator.

What to Expect From Application to Closing

An IRRRL skips most of these steps.

  1. Eligibility first. I request your COE so we know your entitlement and funding fee status before anything else.
  2. Application and Loan Estimate. You send documents and receive a Loan Estimate within three business days of applying.
  3. VA appraisal. VA assigns the appraiser. If the value may come in low, VA's Tidewater process gives us a chance to submit more sales data before the value is final.
  4. Underwriting. The lender reviews credit, debt-to-income and residual income, and any conditions are cleared.
  5. Closing Disclosure and closing. You see final numbers, including any funding fee, at least three business days before you sign.

What Are the Trade-Offs?

Even VA has a few trade-offs.

  • The funding fee is real money if you're not exempt. With 20% or more to put down, I compare it against conventional, which has no funding fee and no mortgage insurance at that level.
  • Primary residence only. No vacation homes and no pure rentals.
  • Entitlement in use limits the next loan. Keeping a VA loan on one home can mean a down payment on the next until your entitlement is restored.
  • Borrowing to 100% leaves no cushion. A full-value cash-out means selling soon after could cost you money.

Frequently Asked Questions

Is there a down payment required for VA loans?
Not with full entitlement. VA is one of the few programs that still allows $0 down on a purchase. Since January 1, 2020 there's no VA loan limit for borrowers with full entitlement, though lenders set their own maximum loan amounts. If part of your entitlement is tied up in another VA loan, you may need a down payment on a larger loan in your county. Putting money down is optional, and a down payment of 5% or more lowers the funding fee if you're not exempt.
What is the VA funding fee?
It's a one-time charge paid to the VA that keeps the program going for future borrowers. The amount depends on the type of loan, your down payment, and whether this is your first use of the benefit. You can roll it into the loan, so you don't have to pay it in cash at closing.
Who is exempt from the VA funding fee?
You're exempt if you receive VA compensation for a service-connected disability, or would except that you get retirement or active-duty pay instead. Surviving spouses who receive Dependency and Indemnity Compensation are exempt. So are active-duty service members who have received the Purple Heart. If your disability claim is pending when you close and your rating is later made effective before your closing date, you may be eligible for a refund of the fee.
Can I use a VA loan more than once?
Yes. Your entitlement can be restored and reused throughout your life. Sell the home and pay off the VA loan, and it's restored for your next home. Pay off the loan but keep the property, and you can request a one-time restoration. You can even hold two VA loans at once with enough remaining entitlement.
What is a VA IRRRL?
It's the Interest Rate Reduction Refinance Loan, often called the VA Streamline. It replaces a VA loan with a new VA loan at a lower rate, or moves you from adjustable to fixed. VA doesn't require an appraisal or credit underwriting, though many lenders add their own checks. Your loan must be seasoned, meaning at least 210 days after your first payment was due, with six consecutive monthly payments made. The costs must be recouped through lower payments within 36 months. It's not a cash-out loan.
How much can I take out with a VA cash-out refinance?
Under VA rules, a cash-out refinance can go up to 100% of your home's appraised value. That's higher than conventional or FHA cash-out allows. Many lenders cap it lower, so the real ceiling depends on the lender and your credit. It's fully underwritten with an appraisal, credit and income, and VA requires the lender to show you a comparison of your old and new loan.
More questions (6)
Can I refinance an FHA or conventional loan into a VA loan?
Yes. If you're eligible, a VA cash-out refinance can pay off any existing loan, including FHA, conventional or non-QM, even with little or no cash out. Most people do it to end monthly mortgage insurance. FHA's annual MIP and conventional PMI both go away when the new loan is VA. It's fully underwritten and needs an appraisal, and the funding fee applies unless you're exempt.
What credit score do I need for a VA loan?
The VA doesn't set a minimum credit score. Lenders set their own minimums, called overlays, and they vary widely. On select programs, VA options may be available below 580, so a lower score doesn't automatically keep you from using the benefit you earned. What VA does look at closely is your recent payment history, your debt-to-income ratio and your residual income.
What is residual income on a VA loan?
Residual income is the money left over each month after your mortgage payment, taxes, insurance, debts and an estimate of maintenance and utilities. VA publishes a table of minimums that vary by family size and region of the country. VA also uses a 41% debt-to-income benchmark, but it's a guideline, not a hard cap. A file above 41% can be approved when residual income comfortably exceeds the minimum.
How do I get my VA Certificate of Eligibility (COE)?
One quick way is through me. I can usually request your COE online through VA's lender system in a few minutes. You can also request it yourself on VA.gov. Veterans typically need their DD-214. Active-duty service members need a statement of service signed by their command. Guard and Reserve members need records showing their creditable service. The COE also shows your remaining entitlement and whether you're exempt from the funding fee.
Can I buy a duplex or multi-unit home with a VA loan?
Yes, up to four units, as long as you live in one of them as your primary residence. You generally need to move in within 60 days of closing. Rental income from the other units can help you qualify when it's documented and meets the lender's requirements, often including reserves. VA loans can't be used for a pure investment property or a vacation home. For a rental you won't live in, I'd use conventional or a DSCR loan.
Do you offer construction-to-permanent loans?
On select programs, yes. Ask and I will check which fit your plans.

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Let's Look at Your VA Options

You earned this benefit. Tell me your plan and I'll compare your VA options across my lender network.

Find your optionsBook a call

Or call (949) 990-6030

Rates and program availability may vary based on the state or region in which the financed property is located. This is not a credit decision, an offer, or a commitment to lend. Program restrictions apply.

Mathis Mortgage and Lumin Lending Inc. are private mortgage providers and are not affiliated with, endorsed by, or acting on behalf of the U.S. Department of Veterans Affairs (VA) or any government agency. VA loans are originated by Lumin Lending Inc. (NMLS #2716106) and guaranteed by the VA for eligible veterans and service members.

Randy Mathis NMLS# 1516760 | DRE# 02236644 | Lumin Lending Inc. NMLS# 2716106 | DRE# 02291443. Equal Housing Opportunity.