There are several types of VA home loans to choose from, each with unique benefits. The most basic type of VA loan is a purchase loan. With a purchase loan, you receive a standard mortgage for your home or condo. The only difference a VA purchase loan has over a traditional home loan is the lack of a down payment. As with a traditional home loan, you are encouraged to speak with multiple lenders to get the best rates possible.

VA home refinance loans are available if you already have a mortgage. Refinancing allows you to replace your existing mortgage with a new loan. The process is the same as applying for a VA home loan, including rate negotiation. If your financial situation has improved, you can get better rates on the new loan.

Even if your VA refinance rates are only slightly better than the initial loan, you ultimately end up spending less money. This is because mortgages on average are paid out over a longer period, so you accrue much more in interest rates. Because VA home loans normally provide better rates, you have a greater chance of reducing your mortgage than traditional home loan refinancing.

VA refinance rates are also available from a VA Interest Rate Reduction Refinance Loan (IRRRL) IRRRL is also known as a streamline refinance. With this type of loan, you do not need an appraisal or any additional documentation to negotiate for new rates. This type of refinancing loan either allows you to lower your interest rate, or switching your previous mortgage to a fixed-rate.

There are also VA loans available if you already own a house and want to make improvements or changes. These are known as VA renovation loans. The application process for a renovation loan is almost identical to a home loan. The biggest difference is the loan amount is typically much lower than what you borrowed for your home.

Not as many lenders offer renovation loans. If you are having trouble finding a lender, consider asking for help from your VA office. Your public housing agency may also be able to recommend a lender.

The final type of VA home loan is only available to Native American veterans. This is known as the Native American Direct Loan (NADL). NADL is a VA loan that can only be used if you are buying, building or renovating a home located on federal trust land. In addition to no down payments, you do not have to pay private mortgage insurance on a NADL. You are also eligible for a low-interest, fixed mortgage rate.