How to find the best VA lender: A step-by-step guide
Key takeaways
- Eight out of 10 VA borrowers in 2025 paid above the most competitive price available for their borrowing profile, according to Bankrate’s Hidden Homeownership Tax research. Averaged across all VA borrowers, that came to $2,922 a year.
- Your mortgage rate, discount points and most of your closing costs set by the lender, not the VA, which is why it’s so important to compare lenders. The VA only sets the funding fee and caps lender origination charges at 1% of the loan amount.
- Get Loan Estimates from at least three VA lenders on the same day, compare the annual percentage rate (APR) and total closing costs side by side, then confirm your loan officer has closed VA loans recently.
For eligible service members, veterans and some surviving spouses, a loan backed by the U.S. Department of Veterans Affairs (VA) is one of the lowest-cost ways to buy or refinance a home. There’s no down payment requirement and no mortgage insurance.
But the VA doesn’t set your interest rate. Your lender does, and what lenders charge varies more than most borrowers expect. Here’s how to find one that prices yours competitively.
Most VA borrowers still overpay — here’s why lender choice matters
Even with the benefits VA loans offer, like competitive rates and no down payment, many veterans end up paying more than they need to.
According to Bankrate’s Hidden Homeownership Tax research, roughly 8 in 10 VA borrowers overpaid for their mortgage in 2025. In fact, the average VA borrower overpaid by an estimated $2,922 a year, or $23,375 over the first eight years of the loan.
That overpayment isn’t because borrowers are careless, but because the mortgage process doesn’t invite comparison shopping. Most people take the first quote they get, from the lender their real estate agent recommended or the bank they already use. Unless you go out of your way to solicit multiple quotes, you won’t know how that quote stacks up.
That’s the case for getting three quotes. VA rates, points and fees are each set by the lender, so one offer can’t tell you whether it’s competitive.
4 steps to find the best VA mortgage lender
Step 1: Confirm you qualify for a VA loan
To get a VA loan, you must have a Certificate of Eligibility (COE) based on your military service, and you must be buying a primary residence, not an investment property or second home. Surviving spouses may also qualify if the veteran died in service or from a service-connected disability, or was a prisoner of war or missing in action, and the spouse hasn’t remarried.
While the VA doesn’t impose minimum credit score requirements, VA lenders can and do, so you’ll need to meet these standards to qualify. Most want a credit score of at least 620. The 41% debt-to-income (DTI) ratio you’ll often see quoted comes from the VA rather than lenders: above that level, VA guidelines require extra documentation to verify you can carry the payment. Plenty of lenders approve VA loans above 41%.
Your income also has to be stable, reliable and expected to continue. Separately, you’ll need to meet the VA’s residual income requirement. Residual income is what’s left each month after your mortgage, taxes, insurance and other major debts are paid, and the amount you need depends on your area, your household size and your loan amount.
If you fall below the minimum requirements, it doesn’t mean you won’t get the loan; it just may be more difficult to get approved.
Step 2: Build a shortlist of lenders to compare
Recommendations from service members who have gotten a VA loan can be a great place to start. Social media can also help you identify potential lenders, but take those reviews with a grain of salt, as they may not reflect the full picture.
Ask your referrers what their experience was like. Was it a smooth process? Was the lender able to answer their questions and guide them through the paperwork? If they don’t mind disclosing, the cost of the loan is also useful information. If more than a few people recommend the same lender, odds are it’s a worthy lead, but it’s still important to do your own research.
Once you have a list of lenders, see how each measures up to the next two yardsticks: cost and experience.
Step 3: Get at least three quotes and compare Loan Estimates
As with any loan, it’s important to comparison shop with at least three lenders.
Be sure to get the APR, or annual percentage rate, in addition to the interest rate, from each lender. The APR reflects the total cost of the loan, including all the lender fees, so it’s typically a better basis for comparison than just the interest rate. You should also review each lender’s closing costs — typically 2% to 5% of your loan amount — and the terms on each loan, to ensure you’re making fair comparisons.
Request all three Loan Estimates on the same day for the same loan, or the numbers won’t be comparable. Getting multiple quotes won’t hurt your credit any more than getting one quote would; credit bureaus treat mortgage inquiries made within 14 days of each other as a single inquiry.
If you already have a VA loan and want a lower rate, start with an Interest Rate Reduction Refinance Loan (IRRRL), which skips the appraisal and most of the income documentation. Rates still vary by lender, so compare three quotes on that too.
Step 4: Verify your lender’s VA loan expertise
Once you’ve narrowed your shortlist based on rates, make sure your lender and loan officer can support you with VA loans specifically. Find out:
- What share of your company’s loans are VA loans, and how many have you personally closed recently?
- What training do you receive in working with VA loans?
- How long do your VA loans typically take to close?
- Will I work with the same loan officer throughout the process?
You can also check your impressions against reviews of the lender or lenders you’re considering.
VA lender scorecard: What to compare
Many banks, credit unions and online lenders offer VA loans. So what distinguishes them? To find the best VA mortgage lender for you, consider these factors:
| Factor | What good looks like | Reason to pause |
|---|---|---|
| VA loan experience | Closes a high volume of VA loans, both company-wide and from your loan officer. | Closes a handful of VA loans a year and treats yours as an exception. |
| Documentation support | Helps you obtain your COE, DD-214 and other required documents. | Hands you a list and leaves the military paperwork to you. |
| VA funding fees | Explains the funding fee and whether you qualify for an exemption. | Can’t explain the fee tiers, or quotes you the wrong one. |
| Lender fees | Clearly itemizes origination fees, discount points and other charges. | Rolls all charges into a single line, or won’t break them out. |
| Interest rates | Offers competitive rates and clearly explains the APR and loan terms. | Quotes a rate verbally and won’t put it in a written Loan Estimate. |
| Customer service | Responds promptly and provides clear, knowledgeable guidance. | Goes quiet between calls, or can’t answer basic VA questions. |
| Convenience | Offers an easy application process and accessible account services. | No way to track your file, and documents go missing. |
If you really want to dig deep into a lender’s expertise, ask the lender if it has “automatic authority,” meaning it has the ability to close VA loans without the prior approval of the VA. Most established VA lenders have it. If yours doesn’t, your file goes to the VA for approval, which adds time. Either way, automatic authority doesn’t guarantee you’ll be approved.
Signs a VA lender isn’t the right fit
Anyone who seems unfamiliar with VA loan requirements or leaves you to handle military-specific paperwork on your own may not be the best fit. Also be wary of lenders who give vague or inconsistent information about fees or the total cost of the loan, or who won’t put a quote in writing.
Communication matters, too. If a lender pressures you to commit or you can’t reach them on the phone, consider going with a different lender. A good VA lender should be transparent about costs and willing to guide you through the process from beginning to end.
When you have three Loan Estimates in hand, take the lowest one to the lender you’d rather work with and ask them to match it.
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