4 Little-Known Perks of a VA Loan

This benefit helps service members and veterans achieve homeownership more easily.

If you're a military veteran or active service member, perhaps you've considered using a loan from the U.S. Department of Veterans Affairs (or VA, for short) to buy a home. You might be familiar with the high points of VA home loans, such as the fact you're not required to make a down payment to use one. The credit score and income requirements for VA loans are often more flexible than what you might see for other mortgage types. You also won't be required to pay mortgage insurance (like the private mortgage insurance that comes with a conventional home loan if you make a down payment of less than 20%).

No doubt, these are all great perks, and definitely make a VA loan worth it if you qualify for one. However, there are four other perks of these mortgage loans you may not know about. Read on and learn about even more VA loan benefits.

1. Surviving spouses can qualify, too

The first little-known perk of VA loans is that you may qualify for one even if you are not a veteran or active service member. If you were the spouse of a veteran who died in military service (active, reserve, or national guard), or was rated totally disabled from duty for a period of either 10 or more years before death, or five or more years from active duty, you may be eligible. There are a few other rules here; you can also qualify if your spouse is MIA (missing in action) or was/is a POW (prisoner of war). And if you remarried after the age of 57 and after Dec. 16, 2003, but used to be married to a service member who died in the line of duty or as a result of their military service, that's yet another way to qualify.

Regardless of which of these surviving spouse designations you meet, you will have to also have or be eligible for a Dependency and Indemnity Compensation (DIC) benefit award, which is a tax-free monetary survivor benefit given to children, spouses, and parents of veterans.

2. No loan limits with a full entitlement

You may be concerned about qualifying for a VA loan if you live in an expensive part of the country. The good news is that there is now no cost limit for a home purchased using a VA loan if you, as a veteran or service member, have a full entitlement or home loan benefit. This means you're buying a home for the first time, or you no longer own a property with a VA mortgage loan. (Prior to 2020, if you were buying a home at a price that exceeded conforming loan limits, you would have needed to make a down payment on the portion of the price exceeding that limit.) This doesn't mean you'll get approved by a lender for any amount to buy a home, however. Lenders make their own rules regarding credit score, income, and value of assets when considering how much to lend a buyer.

3. You can use a VA loan multiple times

As you may have parsed from the above section, you are allowed to use a VA loan multiple times to purchase homes. There are a few rules here; you must be a first-time buyer, or otherwise no longer own any homes paid for with VA loans (they can either be paid off or have been transferred to another qualified veteran or service member). You'll have to apply to the VA to get your full entitlement restored, and then you'll be good to go to buy another home with a VA loan!

4. No fees for paying off the loan early

Finally, unlike with some types of home loans, you as the home buyer will not be charged any fees if you want to make extra payments on your mortgage and pay off the loan early. Some lenders for conventional home loans and other types charge prepayment penalties, which is exactly what you don't want if you're trying to save money on interest by paying off your home loan early.

All in all, a VA home loan can be an excellent veteran or service member benefit, thanks to both the more well-known perks and the ones I discussed above. You can find even more detailed information about all these benefits on the VA's website. Happy house hunting!