10 VA Loan Myths That Could Cost You Thousands

VA Loans Are Powerful—But Misunderstood

VA loans have helped millions of veterans, active-duty service members, and surviving spouses achieve homeownership with affordable terms and unmatched flexibility. Yet despite their widespread use, misinformation about VA loans continues to circulate. And these myths aren’t just annoying—they can be costly, holding you back from benefits you’ve earned.

Whether you’re buying your first home or considering a refinance, separating fact from fiction is essential. Here are 10 VA loan myths that could cost you money, time, and opportunities—and the truth you need to beat them.

Myth 1: VA Loans Are Only for First-Time Buyers

Nope. VA loans are not a one-and-done benefit. Eligible borrowers can use their VA loan entitlement repeatedly throughout their lifetime—whether they’ve bought one home or five. You can restore your entitlement by selling the property and paying off the VA loan, or use partial entitlement for multiple transactions if the math works out.

Bottom line: Your benefit doesn’t expire after one home.

Myth 2: You Can’t Use a VA Loan More Than Once

Here’s another twist on the first myth. Even if you haven’t sold your current home, you may still be eligible to use a VA loan again—especially if you’re relocating due to service. With enough remaining entitlement and lender approval, you can hold two VA loans at once.

Bottom line: VA loan reuse is more flexible than most people realize.

Myth 3: VA Loans Have Loan Limits That Cap Your Purchase

The VA no longer limits the loan amount for buyers with full entitlement. The old county-based limits only apply if you’ve already used part of your entitlement and haven’t restored it.

That means: If you qualify and have full entitlement, you can finance homes above old limits—provided your lender approves the amount based on your income and credit.

Bottom line: There’s no set purchase cap if your entitlement is intact.

Myth 4: VA Loans Come with Higher Interest Rates

Actually, it’s the opposite. Because VA loans are backed by the federal government, lenders view them as low-risk. That often results in interest rates that are lower than conventional loans—especially for borrowers with moderate credit scores.

Bottom line: VA loans are designed to save you money—starting with your rate.

Myth 5: You Need Perfect Credit to Qualify

Unlike conventional mortgages, VA loans are lenient when it comes to credit scores. While most lenders prefer a score of 620+, some will approve loans with scores in the 580 range, especially if other factors—like income or payment history—are strong.

Bottom line: VA loans don’t demand perfect credit—they reward financial responsibility.

Myth 6: VA Loans Take Longer to Close

This myth used to hold weight—but not anymore. With modern digital lending tools and widespread VA lender experience, closing times for VA loans now rival (or beat) conventional loans. The key is working with a lender experienced in VA underwriting.

Bottom line: VA loans don’t drag—they close just as fast with the right team.

Myth 7: You Can’t Buy a Condo or Manufactured Home

You absolutely can—if the property meets VA requirements. For condos, the development must be VA-approved. For manufactured homes, they must be permanently affixed to a foundation and meet code.

Bottom line: VA loans support a range of property types, not just traditional homes.

Myth 8: VA Loans Require a Down Payment

One of the best-known VA loan perks is zero down—but some people still think it’s required. In most cases, eligible borrowers don’t need to put any money down. The only exception is when part of the entitlement is already used and the price exceeds the VA limit.

Bottom line: Most VA buyers can skip the down payment entirely.

Myth 9: VA Loans Include Monthly Mortgage Insurance

This one’s easy. VA loans never include private mortgage insurance (PMI), even if you finance 100% of the home. That’s a major savings compared to conventional loans that require PMI for down payments under 20%.

Bottom line: VA buyers save money monthly by skipping PMI completely.

Myth 10: You Can’t Refinance a VA Loan Easily

Va Loans come with a built-in refinance option called IRRRL—or Interest Rate Reduction Refinance Loan. Often called a “VA Streamline,” this program lets you refinance without appraisal, income verification, or credit check—making it one of the simplest refi options available.

Bottom line: VA loans make refinancing easy, fast, and budget-friendly.

Final Thoughts: Know the Truth, Maximize the Benefit

VA loans are a powerful tool—but only if you understand how they work. Myths about down payments, usage limits, refinancing, and property types keep too many eligible borrowers from exploring their full benefits. But now that you’ve got the facts, you can avoid these costly misconceptions and make smarter, more confident decisions.

Don’t let outdated beliefs hold you back from homeownership—or prevent you from refinancing when rates drop. Your service earned you a better way to buy. Make sure you use it wisely.