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Current VA Mortgage Rate
Current VA mortgage rates average 4.56% nationally, and have changed by +0.10% over the past twelve months. This is not an APR and does not factor in any closing costs or fees.
Current VA Loan Rates Online
The key advantage of the VA loan program is how much it reduces your upfront costs, not how much you save on interest. The monthly payments estimated above assume a down payment of 5%, but in many cases you should be able to find VA financing that will require no down payment at all.
While the VA loan offers a drastic reduction in the required down payment on a house, applicants are still responsible for paying a VA funding fee to cover the cost of the Veterans Administration's mortgage guarantee program. Making a down payment can lower the VA funding fee, so be sure to check out your options, and make sure that you've accounted for such extra costs before you choose a mortgage lender based on a low-rate offer.
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Recent VA Loan Trends: Rising Rates, More Approvals and Larger Loans
As interest rates continue to rise, VA loan rates have increased, but so have the rate of approvals and the average size of VA loans. In addition, VA rates are consistently lower than conventional mortgage options.
Mortgage rates were historically low after 2008, but the Federal Reserve is gradually raising rates once again and mortgage lenders tend to follow. This will make the VA loan more expensive than it has been in the past, and people who are considering refinancing into a new VA loan may want to do so soon. As time goes by, it's less likely that you'll be able to refinance at a rate that's lower than what you pay on your mortgage today.
Recent VA Loan Rates
|Avg VA Loan Rate||Avg 30-Yr Mortgage Rate||Difference (basis points)|
In 2017, VA loan rates were 20 to 30 basis points lower than mortgage rates in general. The most recent data show that this difference has basically remained the same since July. Low rates aren't the main advantage of the VA loan program—that would be the low down payment option—but for now the best VA lenders seem to offer slightly better rates than most other mortgage types.
VA Loan Approval Rates Improved
On the other hand, it's become easier to secure approval for a VA loan than in previous years. The average closing rate of VA loan applications has gone up to 66% this year, from 56% in 2014.
VA purchase applications consistently see higher rates of approval than refinance applications: three out of four purchase loans make it to closing, while almost half of all VA refinances are denied. In fact, VA loan refinance applications experienced a lower rate of approval than refinance applications for other kinds of home loans. Overall, the data suggest that you're more likely to get approved for a VA purchase loan than for a standard mortgage, but less likely to get approval for VA refinancing compared to a regular refinance.
At the same time, the typical FICO credit score of successful VA applicants actually decreased by a few points, while their average debt-to-income ratios (DTI) increased. These statistics indicate that applicants were able to obtain VA home loans with slightly worse credit and slightly more debt than in previous years. Finally, these changes apply to both purchases and refinancing: VA loans appear easier to obtain today, regardless of your loan purpose.
Average VA Loan Amounts Grew
The typical VA loan has not only become easier to obtain, but also larger in total dollar amount. However, the median price of houses purchased with VA funding has mostly stayed below the median price of homes bought with other mortgage types.
In October 2017—the latest available data point—the median sales price of a home bought with a VA loan was $306,000. Although this number was substantially lower than the overall median sales price of $328,600 in that same period, it remains higher than typical property values in many parts of the U.S. This means that the VA loan continues to be a reasonable option for veterans and servicemembers regardless of where they're looking to purchase a house.
However, rising VA loan amounts are also partly due to the aggressive increase of home prices in many of the more expensive U.S. markets today. It costs homebuyers more to obtain the same quality and square footage in a house than it would have a few years ago. While this means that the relative purchasing power of VA loans hasn't increased all that much, the benefit of having no down payment is still a major financial advantage to veterans and servicemembers.
Interest Rates at Top-Rated VA Lenders
The VA loan application involves a number of elements that aren't required in a standard conventional mortgage, which makes it important to find lenders that specialize in handling VA loans and prioritize customer satisfaction. If you prefer start your VA loan search based on the quality of service rather than cheapest rate, consider the lenders below.
Best VA Lenders by Customer Satisfaction
|2017 J.D. Power Rating||30-Year VA Loan Rate|
|Navy Federal Credit Union||829||4.000%|
|Pentagon Federal Credit Union||-||4.375%|
The lender ratings provided by the J.D. Power Primary Mortgage Origination Satisfaction Study are based on customer responses about factors like the application process, product choices, and loan closing. How different lenders handle application requirements, what special options they offer, and how long the funding process takes are questions that often get overlooked in favor of comparing interest rates and APRs. It helps to bear these issues in mind when speaking with a loan officer for the first time.
The mortgage rates above may change on a regular basis and rely on specific assumptions about the number of discount points or origination fees paid on the VA loan. However, each of these lenders has an established reputation for delivering above-average customer service in a crowded industry. Aside from Veterans United, all of these lenders also offer other products such as checking accounts and credit cards, making them a convenient all-in-one financial solution for veterans or active-duty families.