Created in 1944 under what is commonly referred to as the GI Bill, VA loans are designed to give veterans and their surviving spouses every advantage when it comes to purchasing a home.

In order to be eligible for a VA loan, you generally need to be active duty or retired under conditions other than dishonorable. If you served, or are currently serving on active duty, you’re usually eligible for VA loan benefits after 90 days of service. If you’re a reservist, or a member of the National Guard, you’ll either need six years of honorable service under your belt, or at least 90 days of active duty service, with at least 30 days served consecutively under Title 10 or 32 mobilization. Surviving spouses are also eligible for VA loans if the veteran died in service or from a service-connected disability, or if the veteran was declared missing in action or a prisoner of war for at least 90 days.

VA loans come with some strong benefits.

• For starters, they usually require no cash down, which drastically reduces the cost to purchase a home.
• There is no minimum FICO score set by the VA, which allows veterans to qualify for VA financing, even if their credit isn’t the best.
• There is no set DTI maximum with VA loans, which means that some veterans can qualify for a home purchase that would be outright impossible under another loan program.

Last but not least, the VA has some pretty unique rules when it comes to closing costs and seller concessions.

According to the VA lender’s manual, the VA does not consider seller paid closing costs as seller concessions, nor does it limit who can pay closing costs on behalf of the borrower or how much they can contribute. Because of this, it is entirely possible for a veteran to purchase a house with no money out of pocket.

The VA does limit seller concessions to 4% of the purchase price of the home. That said, the VA does allow a few additional options for VA buyers to use these seller concessions:

• The veteran can use seller concessions as cash in lieu of repairs to the property.
• The veteran can also use seller concessions to negotiate furniture to be left behind by the seller as part of the transaction.
• The veteran is allowed by the VA to use seller concessions to pay off judgements or even pay off consumer debt in order for them to better qualify for their purchase.

Taking all this into consideration, it’s clear to see that, when it comes to helping our nation’s heroes secure a place to settle down, there are rarely any lending options superior to VA loans.