VA loans are one of the best mortgage products available to anyone, and credit unions are a natural place to look for one. A lot of credit unions were founded to serve military bases and federal workers, and for them VA lending isn't a side product. This guide covers what makes a VA loan different, what to watch for when comparing them, and one quirk of this site you should know about.
One thing up front: I'm not an authority on VA eligibility, and this guide doesn't try to be. The Department of Veterans Affairs is. Where eligibility matters, I'll point you to VA.gov.
Who qualifies
At a high level, VA home loan eligibility is based on military service: active-duty service members, veterans who meet minimum service requirements, members of the National Guard and Reserves who meet their own requirements, and some surviving spouses. The exact service-length rules depend on when and how you served, and there are exceptions.
Eligibility is documented with a Certificate of Eligibility, usually called a COE. Most lenders can request it for you electronically. You don't have to be serving now; eligibility generally carries on after you leave, and it can often be used more than once.
For the actual rules, go to the VA's eligibility page. Don't rely on me or on any comparison site for this part.
What makes a VA loan different
A VA loan is made by a private lender and guaranteed by the VA. The guarantee is what produces the features people care about:
- No down payment requirement. For most eligible borrowers, the VA doesn't require one. A lender may still have its own requirements in some situations.
- No monthly mortgage insurance. Conventional loans with less than 20% down usually carry private mortgage insurance, and FHA loans carry their own mortgage insurance. VA loans don't.
- A funding fee. Instead of mortgage insurance, most VA borrowers pay a one-time funding fee. The percentage depends on your down payment and whether you've used the benefit before. Some borrowers are exempt, including many veterans who receive VA disability compensation. The VA publishes the current rates and exemptions on its funding fee page.
- Typically lower rates than conventional. Because of the guarantee, VA rates usually come in below conventional rates for the same borrower. Not always, and not by a fixed amount.
The funding fee matters for comparison, and it's easy to miss. Most borrowers finance it into the loan rather than paying it at closing. It doesn't show up in the interest rate. So a VA loan at a rate below a conventional loan isn't automatically cheaper — you have to add the fee back in. If you're exempt, you can skip that step, and a VA loan becomes very hard to beat.
Why credit unions figure heavily here
Many credit unions were chartered around military installations or federal employment. Their original members were service members, civilian base staff, and their families. For those institutions, VA lending is core business rather than something they offer because everyone else does.
The obvious example is Navy Federal Credit Union, which serves the whole military community and all Department of Defense employees and lends in every state. Service Credit Union began by serving Pease Air Force Base in New Hampshire. There are dozens of smaller ones with names that give their history away, built around a single base or agency.
In our own data, 333 of the 1,185 credit unions we track currently publish at least one VA rate. That count comes live from the database, so it moves as credit unions add or drop the product from their rate pages. It only counts institutions that publish a VA rate online; others offer VA loans but only quote them on request, and those won't show here.
You don't need a military connection to join most credit unions, but the military-founded ones tend to have the most VA experience. That's worth something on a VA loan, which has its own appraisal and paperwork requirements.
Comparing VA rates honestly
Two rules make VA rate comparisons meaningful:
- Compare VA to VA. VA rates aren't directly comparable to conventional rates. The guarantee, the funding fee and the absence of mortgage insurance all change the cost in ways the rate doesn't show. If you're choosing between a VA loan and a conventional one, compare total cost on real Loan Estimates, not headline rates.
- Compare at the same points. A VA rate with a point paid isn't comparable to one without. This is true of every mortgage, and the guide to APR, rate and points explains how to read the three together.
Our tables show VA 30-year fixed and VA 15-year fixed as separate products, and purchase and refinance separately too. A VA 30-year rate is only ranked against other VA 30-year rates.
Why a lender may appear for one product and not another
This is a caveat specific to this site, and it can look like a bug when you first see it.
Not every credit union that offers conventional mortgages in a state offers VA loans there. Some lend conventional nationally but limit VA (or FHA) to their home region, often because of which investors buy those loans or which states they've set up government lending in. Where a credit union tells us which products it offers in which states, we filter for it: its conventional rates can show in a state where its VA rates don't, and the other way round.
So if you see a lender on the conventional table for your state and not on the VA table, that's usually deliberate. The reverse is possible too. Most credit unions don't publish product-by-state detail at all, and for those we assume their products apply wherever they lend. That assumption could be wrong, which is another reason to ask directly.
What a credit union VA loan is like in practice
The process is mostly the same as at any VA lender, because the VA sets the rules. There will be a VA appraisal, which checks both the value and that the home meets the VA's minimum property requirements. The lender will look at your credit and income under its own standards on top of the VA's. Closing costs follow VA limits on what a veteran can be charged.
Where credit unions tend to differ is in the lender's own fees and overlays — the extra requirements a lender adds beyond the VA's minimums, such as a higher credit score. Those vary a lot between institutions and are almost never published. That's another reason to get more than one Loan Estimate: two credit unions quoting the same VA rate can charge quite different fees, and one may approve a file the other turns down.
Membership works the same way as for any other loan: you join first. Military-founded credit unions usually make that easy for anyone with a service connection, and many now accept members well beyond it. If you're not sure which ones you can join, the membership guide explains the rules, and this guide covers whether an out-of-state one will lend where you live.
Finding VA rates
On any state rate page, use the product selector to switch to VA 30-year or VA 15-year. The table ranks the credit unions you can likely join that publish that product in that state.
Or use the ZIP search on the home page to see credit unions matched to your location, then pick VA from the product menu. Every rate links to the credit union's own page, so you can check it against the source.
Before you apply anywhere, get your COE sorted through the VA or your lender, and get Loan Estimates from at least two or three lenders on the same day. VA rates move like any other rate, and the only fair comparison is a same-day one.
The short version
- VA.gov is the authority on eligibility. Start there.
- No down payment and no mortgage insurance, but usually a funding fee that doesn't show in the rate.
- Military-founded credit unions treat VA lending as core business.
- Compare VA to VA, at the same points.
- A lender can offer conventional in your state and not VA. We filter for that where we know it.
— Clay Whitfield