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Debunking 5 Myths About VA Home Loans

Read the top myths about VA home loans and learn the truth behind them so that you can make the best decision on whether or not a VA home loan is the right option for your specific requirements.
Oct 20, 2021

The popularity of VA loans has soared in recent years, surpassing the 1 million mark in 2020, and is on pace to break that record in 2021. But despite the success of the VA home loan program, there is still some skepticism among prospective homebuyers when it comes to VA loans.

Read the top myths about VA home loans and learn the truth behind them so that you can make the best decision on whether or not a VA home loan is the right option for your specific requirements.  

Myth 1: Certification is a cumbersome process

The first step in the VA home loan application process is getting an official verification from the VA Office. This certification will assert that the veteran, active-duty military member, or spouse has met the basic eligibility requirements.

In the past, this took a long time to complete since you had to mail a letter to the VA and wait for a hard copy when they replied. Now, the process is done electronically which means you can get results in real-time.

Myth 2: VA appraisals and inspections take ages to finish due to red tape

One of the reasons why VA loans take longer is the smaller number of appraisers in rural areas who are approved to handle VA loans. However, the VA has upped its game by modernizing and streamlining processes.

Today, VA loans close within 55 days on average but there are cases where they close more quickly.

Myth 3: There is a huge chance that you’ll default

VA loans have more relaxed requirements compared to conventional loans. But even with less stringent requirements, VA borrowers rarely default. Furthermore, VA loans are known to have the lowest foreclosure rates when compared to other loan programs!

Myth 4: Sellers are wary about accepting a VA loan buyer’s offer

There are home sellers who believe that they will be required to pay the buyer’s closing fees. This is not true. Typically, the only seller requirement is payment for a termite report and that’s it.

Closing costs are the buyer’s responsibility and not the seller's.

Myth 5: The savings you get on a VA home loan aren’t as good when compared to conventional loans

False. VA loans are half a point below conventional rates and you don’t have to pay for mortgage insurance.

Need More Information on Your VA Home Loan Application?

Now that we’ve addressed VA home loan myths, you can now gain access to all the great benefits a VA loan provides. If you have more questions, you can ask our VA home loan experts and they would be happy to clear things out with you.

 

✅ Benefits of Contract Loan Processing for VA Loans

  1. Specialized VA Knowledge

    • VA loans have unique requirements (COE, residual income, funding fee calculations, appraisal requirements).

    • A contract processor experienced in VA loans can spot potential issues early and streamline the process.

  2. Cost Savings for Lenders

    • No need to hire full-time staff; processors are paid per file.

    • Helps smaller brokerages or lenders manage fluctuating loan volumes without carrying extra payroll.

  3. Faster Turn Times

    • Contract processors often work remotely and are paid per closed file, so they’re incentivized to move loans quickly.

    • They can push COE requests, follow up on VA appraisals, and ensure VA-specific forms (26-1880, 26-8923) are completed on time.

  4. Compliance & Accuracy

    • VA has strict guidelines (e.g., allowable fees, seller concessions, and veteran protections).

    • A skilled processor reduces risk of compliance errors that could lead to loan buybacks or funding delays.

  5. Scalability

    • During high volume seasons (e.g., rate drops, PCS military moves), lenders can bring on extra processors quickly without long-term HR commitments.

  6. Reduced Loan Officer Burden

    • Lets LOs focus on originating, networking, and serving clients while the processor handles gathering DD-214s, income docs, pest inspection reports (if required), and underwriting conditions.

  7. Improved Borrower Experience

    • Veterans and active-duty borrowers often value clear communication and speed.

    • A processor who knows the VA process can anticipate documentation needs and prevent last-minute surprises.

👉 In short: Contract processors help lenders stay lean, compliant, and efficient, while ensuring veterans have a smoother experience.