In the world of mortgages, two major paths diverge. 

You can get a loan backed by a government agency, like a VA loan, FHA loan, or USDA loan. That means that if you fail to pay back what you borrow, the agency helps the lender recoup some of their losses. 

Or you can get a loan in which the lender takes on all of the risk themselves. These non-government-backed loans are called conventional loans. Not all lenders offer government-backed loans, but pretty much every mortgage company offers conventional loans. 

Still, while you might have a (slightly) harder time finding a VA lender, it’s usually the better money move if you’re eligible. VA loans don’t require you to put any money down. They don’t come with private mortgage insurance. And VA mortgage rates are typically lower than the rates on other types of mortgages.  

Why you can usually get VA mortgage rates 

The reason VA mortgage rates often beat conventional mortgage rates all comes down to risk. In fact, most things in mortgages do. Mortgage lenders are in the risk management game. 

They’re lending out huge sums of money. If the borrower repays, they earn a profit via interest. But if the borrower defaults — meaning they fail to repay the loan — the lender takes a hit. 

Obviously, lenders want to avoid that outcome. That’s why applying for a mortgage is so rigorous. During what they call underwriting, lenders take a good, hard look at your financial situation. They want to make sure you can afford to repay. 

With a conventional loan, all the risk sits on the lender. They charge a higher interest rate to help them make more money from the jump. That way, if the borrower eventually defaults, the hit hurts less.

But with a VA loan, the situation isn’t quite so risky for the lender. If you have full entitlement, the VA typically backs 25% of the loan amount. For every $100,000 you borrow, the lender is essentially guaranteed to get $25,000 back. They love that. And they pay it forward in benefits for you.

The VA’s backing is the reason why lenders allow mortgages with 0% down (down payments are another risk mitigation measure). And it’s the main way VA mortgage rates almost always beat conventional rates. 

Comparing VA mortgage rates to the average: 2020–2026

To give you a better idea of the kind of difference VA backing makes, we can look at averages for the 30-year fixed-rate mortgage over the last several years. 

This comes from the Federal Reserve, which routinely posts average rates for VA mortgages, along with overall average rates for the country.

*Data wasn’t available for the same date.

Even a slightly lower rate saves thousands

A difference of a quarter or half percent might not seem very significant. But remember, this is the interest you’re going to be paying on hundreds of thousands of dollars. 

To show just how big of a difference this can make, let’s look at an example. Here, we’re just focusing on your principal and interest (P&I) payment, or the amount that actually goes toward paying down your mortgage. 

Say you want to buy a $450,000 home and you decide to put 3% down ($13,500). 

With the conventional loan rate of 6.16%, your P&I payment would be $2,719. But with the average VA rate of 5.76%, it drops to $2,605. The VA loan saves you $114 a month, or $1,368 a year. That’s roughly half a mortgage payment. 

Over the life of a 30-year loan, this adds up even more. You’d save more than $40,000 by the time you made your final payment. 

Plus, you’ll pay less in interest. With the conventional loan rate, you’d pay $364,214 in interest throughout your loan. But with the VA mortgage rate, that falls to $337,986. That’s more than $25,000 in savings. 

This is just one example. If you want to crunch the numbers yourself, you can use our VA mortgage calculator. 

Shopping VA mortgage rates to get the best one

If you’re eligible for a VA loan, it’s definitely smart to evaluate offers from different lenders. Even though VA mortgage rates tend to beat out conventional ones, that doesn’t mean every lender offers the same thing. One lender might beat the conventional rate by 0.2%, while another beats it by 0.3%. As you now know, even that little difference can add up to big savings. 

We have a full guide to help you compare VA mortgage rates to find the best one for yourself. The big takeaway is that the more you shop, the more likely you are to find a lower rate. Putting some work in now should almost certainly save you thousands of dollars. 

Fortunately, it’s fairly easy to start shopping for VA mortgage rates. We have live rate tables showing offers from different VA lenders.  If you input your information — like your zip code and the price of the house you want to buy — the rate table tailors those offers to you.

From there, you should be able to round up some options. Make sure you get personalized quotes for VA mortgage rates from several lenders. That way, you’ll save as much as possible on your home loan.

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