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Today’s VA Loan Rates

Current VA Loan Rate (December 10, 2022)
30-Year Fixed VA Purchase Loan
5.974% 6.045% APR
Points: 0.660 ($2112.00)
Rates in this table are based on a 740 credit score. for this table.

VA Mortgage Rates for December 10, 2022

The current VA loan rate for a 30-year fixed VA purchase loan is 5.974%, based on an average of over 400 VA loan lenders, banks and credit unions. For current homeowners, the average 30-year VA cash-out refinance rate is 6.751%.

Let's see how these rates compare including APR and assumptions.

Rates in this table are based on a 740 credit score. for this table.
VA Loan Type Interest Rate APR Points
30-Year Fixed VA Purchase 5.974% 6.045% 0.660 ($2112.00)
30-Year VA Cash-Out 6.751% 6.843% 0.828 ($2649.60)

This table shows the latest VA mortgage rates based on over 400 VA home loan lenders from around the country, updated daily. It’s important to compare VA lenders to ensure you get the best service at the right price to achieve your goals.

About VA Mortgage Rates

When you’re shopping for a mortgage, the interest rate you receive can make a major difference in the amount you'll pay over the lifetime of the loan. Finding a mortgage loan with a great rate and competitive terms can impact your home choice and may open up new options for you.

If you're an active military member, Veteran or surviving spouse, you may be able to get a home mortgage loan that is backed by the U.S. Department of Veterans Affairs (VA). VA loans typically offer great rates and come with a host of other benefits. If you think you might qualify, it's important to understand how VA mortgage rates work, how they compare to conventional mortgages and some of the things you can do to help ensure you get the best rates. Here are the details you need to know.

How VA Interest Rates Work

A loan’s interest rate is essentially the cost of borrowing the money. It’s one of the ways the lender is paid for providing you with the money you need to purchase or refinance your home.

If you qualify for a VA loan, you’ll likely get a lower rate than you could with a conventional mortgage loan. However, it’s important to note that the VA doesn’t set mortgage rates. Instead, rates are set by the private lenders who offer VA loans. This means the same borrower may be offered different rates from a variety of lenders.

The U.S. government backs a portion of VA loans. Since this provides lenders with protection against borrower default, there’s less risk involved. This translates into lower interest rates and more lenient approval requirements when compared to conventional mortgages.

Factors Determining your VA Loan Rate

VA loan rates vary from one borrower to the next. When determining the rate to offer, lenders consider a variety of factors including:

Since lender rates offset risk, the higher your credit score, the lower your VA rate will be. Shorter-term (15-year) loans typically have lower interest rates, which will decrease the total amount you spend on interest over the life of the loan. Longer-term (30-year) loans offer lower monthly payments but come with higher interest rates, which will cost you more in the long run.

Overall economic trends can also impact your interest rate. For example, when inflation is high, interest rates tend to increase. Other factors that impact interest rates include housing conditions, the bond market and federal reserve monetary policy.

How to Get the Best VA Mortgage Rate

The mortgage interest rate you receive will impact your minimum monthly payment and, ultimately, play a significant role in the type of home you can afford. Since you'll likely be paying for your mortgage for many years, it makes sense to do everything you can to make sure you get the best possible VA mortgage rate. The good news is, there are a few simple steps you can take to set yourself up for success.

The first is to check your credit score and, if necessary, make adjustments to improve it before applying for your VA loan. While having trouble with your credit score won’t necessarily keep you from getting a VA loan, a higher credit score will help you get a better rate. Some of the things you can do to get a better mortgage rate include:

  • Catching up any past-due accounts
  • Focusing on making on-time payments
  • Paying down credit card balances

It can take time for the changes you make to be reflected in your credit score, so be sure to start this as early as possible.

You’ll also want to spend some time comparing VA lenders. Just remember that you don't want to choose a lender based on rate alone. As you compare your options, be sure to look at other important factors such as the minimum credit score a lender requires and the lender’s rating and reviews. Also remember that VA loan rates change often, sometimes multiple times a day, so it’s a good idea to compare rates a few times before making your final decision regarding which lender to use.

Lower VA Loan Rates with Discount Points

There's also another way to lower your interest rate. Borrowers have the option to spend money upfront to lock in lower VA mortgage rates. This is known as paying for “discount points," and one point typically equals 1% of the total loan amount. When you do this, you are essentially paying some of your interest upfront, which allows you to pay a lower interest rate over the lifetime of your loan.

There are several factors that can help you decide whether paying points may be advantageous. For example, the longer you plan to keep your home, the more of an impact paying points can have. Some lenders limit the number of points you can buy, with many capping it at two. You may want to work with your loan officer to determine whether paying points is a good idea, and if so, what your break-even point would be.

Are VA Loan Discount Points Worth It?

It's entirely dependent on the borrower's financial situation and expected time to live in the home.

From a positive standpoint, you're getting a lower rate forever. However, you'll need to stay in that home long enough to recoup the investment.

Seller Paid VA Loan Discount Points

In most cases, the borrower pays for their own discount points. However, it’s sometimes possible to negotiate with the seller and have them pay points on your behalf. The VA allows sellers to cover up to 4% of the loan amount for expenses like closing costs and discount points.

There’s no guarantee that a seller will be willing to pay your discount points. This will often depend on the current market conditions. In a buyer’s market, this could be worth discussing during your negotiations. However, if demand for homes is high and inventory is low, it's likely that the seller won't be willing to cover this expense.

Are VA loan rates lower than conventional loans?

As a general rule, VA mortgage rates are about 0.5% lower than the rates you’ll see on conventional mortgages. The VA also limits the maximum origination fee a lender can charge to no more than 1% of the total mortgage balance. This makes VA loans a less expensive option for most eligible VA loan borrowers.

Why are VA interest rates lower than other mortgage options?

When a borrower takes out a VA loan, the federal government backs a certain part of the loan (typically one-fourth of the total) against default. The extra protection this guarantee offers is why it's often possible to get VA loans with no down payment and a lower interest rate.

VA loans also offer very flexible credit underwriting. In some cases, you can qualify with a credit score as low as 620. While you’ll likely have to pay a VA funding fee, there’s also no requirement to carry primary mortgage insurance (PMI). These factors combine to make a VA loan very advantageous for those who qualify. If you’re eligible for a VA loan, it's almost always a good idea to explore this funding option.

Are VA Loans Only Fixed Rate?

VA loans come in both fixed- and adjustable-rate mortgages (ARM).

ARMs can be beneficial for some Veterans, especially those only planning to stay in a home for a short time. However, do your homework or coordinate with a trusted lender to determine what mortgage type is best for you. Adjustable-rate mortgages come with risks that fixed-rate mortgages don’t, and everyone’s situation is different.

What's the Difference Between Interest Rate and APR?

The interest rate on your VA loan is the percentage the lender charges for borrowing the money. Annual Percentage Rate (APR) is a more accurate representation of the cost of borrowing because it includes lender fees and discount points along with the interest rate.

APR is a valuable tool when comparing multiple loan offers. Multiple lenders can have the same mortgage rate but different APR based on their fees.

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ICB Solutions is a division of Neighbors Bank, which is an affiliate of Mortgage Research Center, LLC dba Veterans United Home Loans.

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