As Mortgage Rates Rise, Many Veterans Are Overlooking a Major Benefit

In late 2025, Barbara and Robbie McBroom were juggling two households, caring for their nephew, and trying to keep it all afloat when Barbara, 76, suffered a fall.

For Robbie, that was the breaking point.

“Look, that’s enough,” he recalls telling her. “We've got to get somewhere where we can all be together.”

But however necessary the move had become, affording it still seemed out of reach. The couple had burned through much of their savings maintaining two households and needed a bigger home closer to family.

That kind of move has only gotten harder as mortgage rates climbed back above 7%. But the McBrooms had an edge: Thanks to Robbie’s service in the Navy, they were eligible for a Veterans Affairs loan.

The average locked rate on a 30-year VA mortgage was 6.90% as of Oct. 15, compared with 7.29% for a conforming loan, according to Optimal Blue. For a $415,000 loan balance, that rate difference saves about $109 a month in principal and interest, or more than $1,300 a year.

VA loans can also allow eligible borrowers to buy with no down payment and do not require monthly private mortgage insurance, reducing both upfront and monthly costs.

Yet many veterans may not fully understand what the benefit offers. Just 32% of current and former service members in a 2026 survey commissioned by VA lender NewDay USA knew a VA loan could require no down payment. Nearly 4 in 10 were unsure.

How the VA loan changed the math for this family

“It’s daunting when you sit there and look at the cost of a house nowadays,” Robbie tells Realtor.com®.

The McBrooms had reason to be skeptical. They were now living on income from Social Security and VA disability. However, years earlier—when Robbie says they were relying on Social Security alone—they had been turned down for a home loan in Oregon. The experience still colored their expectations.

“You actually go into it thinking, 'Well, you probably won’t get it, but it’s worth a try,'” Robbie says.

Still, Robbie had used a VA loan years earlier. After repeatedly seeing ads for a VA lender, he urged Barbara to make the call.

She was even less convinced.

“I told him it was a waste of time,” she recalls.

But by that afternoon, she says, they had been pre-approved for $450,000 from NewDay USA. Less than a month later, they had closed on a home large enough to bring the family back under one roof.

The financing edge of a VA loan carries even more weight in today's market. When mortgage rates jumped from 6.66% in late August to 7.03% by Sept. 24, Realtor.com estimates the increase alone erased about $11,500 of purchasing power for a buyer on a fixed budget.

But it's far from the only benefit.

“The VA loan is literally the best loan a person can have when they’re trying to buy a house, because there’s no down payment,” says Neil Brooks, a Phoenix-area real estate agent and Navy veteran.

That can be especially powerful for cash-strapped buyers like the McBrooms. The median down payment was $27,100 in the second quarter of 2026, according to Realtor.com. Eligible VA borrowers who don't have that kind of cash can bypass one of the largest costs standing between them and a purchase.

And preserving that cash matters after the offer is accepted, too. Buyers still face closing costs, moving expenses, and the financial cushion needed after taking possession of a home.

Even veterans who use the benefit may not fully understand it

VA loans are already a major source of financing among military-connected buyers. Among veterans who purchased a home in 2025, 55% used one, according to the National Association of Realtors®.

Even so, evidence suggests the benefit still isn't well understood.

In NewDay USA's latest survey, 30% of current and former service members said they were unsure whether they qualified for a VA loan. Nearly one-third said they had received little or no education about the benefit during or after their service.

The confusion can persist even among veterans who are actively thinking about buying. Nearly half of nonhomeowners surveyed said saving for upfront costs was a barrier, while 24% cited a lack of awareness about the benefits available to them.

Among respondents who had already used a VA loan, 47% said they would not have been able to buy their home without it.

Robbie says he now finds himself explaining the benefit to other veterans. One disabled veteran he grew up with was considering buying a home, and Robbie says he told him about the couple’s experience.

“Most of us don’t realize that,” Robbie says.

For the McBrooms, the payoff was family

For younger buyers, getting into a home sooner can have financial advantages that compound for decades.

Realtor.com research found that buying by age 32 is associated with roughly 22.5% more net worth at age 50—about $119,000—than waiting until the 40s to buy.

And while many younger buyers remain locked out of the market, VA loans can help some eligible buyers reach that starting line without spending years saving for a down payment.

Of the 10 metros where Gen Z and millennial homeowners built the most housing wealth between 2019 and 2024, five also rank among the top 25 U.S. metros for VA loans issued per capita, according to Realtor.com research.

“For the younger people, it’s about building wealth," Brooks says about the affordability VA loans offer. "For the older folk, it’s more about security."

It’s an important distinction, because the wealth-building power of homeownership is often discussed narrowly. Yes, it's a story about appreciation, equity, and what a home might someday be worth. But it's also about what ownership allows a family to do in the meantime: Consolidate resources, share care, and create a more stable base across generations.

It's hard to overstate the difference that made for a family like the McBrooms. Their new home replaced two stressed households with one. It gave their nephew not only a bedroom, but also enough extra space for what Barbara describes as a man cave.

In other words, a VA loan did more than make the numbers work on paper; it gave them a way to act while their family was in crisis.

“That was another great thing about the process,” Robbie says, “because that took a lot of pressure off me over what was going on.”

And after months of strain, it brought the couple closer to relatives at a moment when illness, aging, and caregiving were becoming more central to daily life.

That, too, is part of the generational wealth story. 

A home is an appreciating asset, but it’s also the physical infrastructure that allows families to support one another. It can reduce the cost and chaos of living far apart, make caregiving more manageable, and create a stable place for multiple generations to gather, recover, and plan.

Soon after the move, Barbara was able to spend time with her younger brother after a heart attack and other serious health issues. Family members gathered at the new home for a meal together—something that would have been far more difficult in their previous living arrangement.

That kind of stability is part of how housing creates wealth, too.

The McBrooms are not arguing that this market is easy. In fact, without the help of their VA lender, they don't know what they would have done. But it's an important reminder for those who are eligible.

“It is achievable,” Robbie says. “I think that’s the thing people need to know. It is achievable, and the process doesn’t need to be as hard.”