How do I know if my VA loan rate and Loan Estimate are a good deal?

What's different about a VA Loan Estimate?

• No monthly mortgage insurance. VA loans don't have PMI or MIP, so you shouldn't see any on page 1.
• The VA funding fee. A one-time fee, from 0.5% to 3.3%, depending on the loan type, your down payment, and whether you've used your benefit before. You can pay it at closing or roll it into the loan.
• The funding fee exemption. If you get VA disability compensation, you usually don't owe it at all. If you're exempt and the fee still shows up, ask your lender to check your Certificate of Eligibility.
• Lender fees. A lot of lenders charge a flat 1% fee on VA loans. Look at page 2, Section A for that fee and any points.

What should I check line by line?

1. Page 1: Is the rate locked, and until when?
2. Page 2, Section A: Points and lender fees. A really low rate almost always has points behind it.
3. Page 2, funding fee: The right percentage for you, or $0 if you're exempt.
4. Seller concessions: VA caps concessions at 4% of the home's value, but the seller can still pay your normal closing costs on top of that. Make sure the credits match your contract.
5. Page 3, "In 5 years": The best single number for comparing offers.

Why do VA rates online look so different?

Because people post a rate without saying whether they paid points, when they locked, what their credit score is, or whether they rolled in the funding fee. Two "6%" VA loans can cost very different amounts. Compare full Loan Estimates, not screenshots of a rate.

Example scenario (illustrative)

A first-time VA buyer in Florida is buying new construction. The builder's lender quotes a great-looking rate, but page 2 shows points paid with a builder incentive, and the funding fee is on there even though the buyer has a disability rating. A second lender, quoting the same day, confirms the exemption, drops the funding fee, and prices the loan without the builder credit. The buyer then asks the builder to put that same incentive toward closing costs instead.

Our take

You earned this benefit, so make sure your paperwork shows it: no mortgage insurance, the right funding fee (or none at all), and points you chose on purpose. Get two or three VA Loan Estimates on the same day. And if you want me to look one over, send it my way and I'll tell you what I see.