VA Loan Rates
Because the federal government backs VA home loans, lenders have the luxury of charging competitively low interest rates. Eligible veterans and service members find that rates are generally lower with a VA home loan than a conventional mortgage.
The Department of Veterans Affairs (VA) doesn’t set interest rates. Your lender determines the rate on your VA loan based on your unique financial situation.
A variety of factors influence VA loan rates, including:
- Credit score
- Loan Type (purchase, IRRRL, cash-out, jumbo, etc.)
- Loan duration (15- or 30-year)
- Current market conditions
Because of the risk involved in issuing a loan, a good credit score almost always means a lower rate. However, even if your credit report isn’t in perfect shape, you may still have an easier time qualifying for a low rate due to the VA Guaranty.
If credit is a concern, Veterans of America Mortgage offers a no obligation credit consulting service to help get you on the road to preapproval.
See What You Qualify For Today
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Common Questions about VA Loan Rates
Getting a mortgage can be complicated. Veterans of America Mortgage works to simplify the process through education and helping you understand your options.
We’ve compiled some of the most common mortgage rate questions below so that you can make more informed decisions.
Who sets VA loan rates?
Private lenders, such as mortgage companies and banks, set interest rates on VA loans. The Department of Veterans Affairs (VA) does not set the rate but backs a portion of each loan against default.
How do VA loan rates compare with the rest of the market?
On average, VA loan rates are typically lower than both FHA and conventional mortgage rates. VA loan rates are generally lower due to the VA backing a portion of each loan.
How are VA loan rates determined?
A variety of factors go into determining VA loan interest rates. Many of these factors stem from market forces beyond the lender’s control – including inflation, job growth, and the secondary mortgage market.
Beyond market conditions, VA loan rates are determined by your:
- Mortgage credit scores
- Previous loan repayment history
- Loan duration (15 or 30-year)
- Loan type (purchase, IRRRL, cash-out, jumbo, etc.)
How often do rates change?
VA loan rates can change frequently – sometimes multiple times a day.
Are VA refinance rates different from VA purchase rates?
VA refinance rates are often different than rates on VA purchase loans. The type of VA refinance loan, the borrower’s credit score, the loan-to-value ratio, and other factors can all play a role in VA refinance rates.
See current VA refinance rates in the table below.
VA Refinance Type Interest Rate APR
30-Year Fixed VA Purchase 4.50% 4.735%
15-Year Fixed VA Purchase 4.125% 4.532%
30-Year Streamline (IRRRL) 4.50% 4.565%
15-Year Streamline (IRRRL) 4.125% 4.237%
What VA mortgage rate can I get?
Rates are unique to each borrower’s financial situation. Speak to a Veterans of America Mortgage home loan specialist at 1-800-884-5560 to start your rate quote.
What is APR?
It is important to understand the difference between your interest rate and the Annual Percentage Rate (APR). The interest rate on your VA loan is the cost you pay each year to borrow the money and does not reflect fees you may incur to get the loan.
On the other hand, the APR on a VA loan is a broader reflection of borrowing costs, including the interest rate and fees associated with getting the mortgage.
APR can take into consideration the following items:
- Interest rate
- Origination fees and costs
- Closing agent fees
- Discount points
- Other fees dependent on the specific transaction
APR is typically higher than your base VA loan interest rate. APR is a tool that can help you compare mortgage offers. But understand that lenders may calculate APR differently.
What are discount points?
Borrowers have the option to buy down their interest rate by purchasing discount points. When you purchase discount points, you are essentially paying interest upfront to receive a lower rate over the life the loan.
Points are generally more advantageous to borrowers who plan to own the home for a longer period of time. Your loan officer can help you determine the break-even point of purchasing discount points, or if points even make sense for your specific situation.
What is a rate lock?
A rate lock guarantees a set interest rate for a specific amount of time – typically ranging from 30 to 60 days. Rate locks are an essential part of the mortgage process, as mortgage rates often fluctuate daily.
How do you lock in your VA loan interest rate?
Buyers have to be under contract in order to be eligible for a rate lock. Once that’s in hand, the timeline can vary depending on a host of factors, including the type of loan, the overall economic environment and more.
If you’re ready to see where rates are right now, or if you have more questions, contact a home loan specialist at start your VA Home Loan quote online.or
There’s no obligation, and you’ll be one step closer to owning your brand new home.
Why Veterans of America Mortgage?
Locking in your interest rate at the right time is key, which means it’s essential to find a lender who understands your needs and the forces that shape VA loan interest rates.
Some lenders try to entice borrowers with unbelievably low rates that are nearly impossible to qualify for. We’ll work within your financial means and give you an accurate and realistic quote.
With Veterans of America Mortgage, there are no hidden costs or locking fees. By speaking with a Veterans of America Mortgage loan specialist, you’re given total transparency when it comes to your interest rate.
Are you a first-time homebuyer? Read our next section for more information about
purchasing your first home with a VA Loan.