38 CFR Part 36
VA Home Loan Guaranty
The loan guaranty program, entitlement, and the funding fee — including the service-connected exemption.
Read the official text of 38 CFR Part 36In plain English
Part 36 governs the VA home loan guaranty. The VA does not lend the money; it guarantees a portion of a private lender’s loan, which is what makes zero down payment and no private mortgage insurance possible.
Most borrowers pay a one-time funding fee that varies with down payment and whether it is a first or subsequent use. Veterans receiving VA disability compensation at any rating are exempt from the funding fee entirely — and surviving spouses receiving DIC are exempt as well.
What the rule actually requires
- The VA guarantees a portion of the loan, allowing no down payment and no private mortgage insurance.
- A one-time funding fee applies, scaled by down payment amount and first versus subsequent use.
- Veterans receiving VA disability compensation are exempt from the funding fee.
- Entitlement can be restored or partially reused after a prior VA loan.
Why this matters to your claim
The funding fee exemption is worth thousands of dollars on a single purchase. Veterans who close before their rating is granted can request a refund of the fee once the award is effective.
This is our plain-English summary, written for veterans — it is not the regulation itself and it is not legal advice. The controlling text is the current official version, linked above. The VA makes all final decisions about eligibility and payment.
Official text of 38 CFR Part 36
