The United States Department of Veterans Affairs (VA) guarantees loans made to veterans and not remarried surviving spouses for the purchase or refinancing of homes, condominiums and manufactured homes. The VA guarantees part of the total loan, permitting the veteran to obtain a mortgage with a competitive interest rate, even without a down payment if the lender agrees. The VA requires a down payment for the purchase of a manufactured home.
The VA also requires a down payment for a home or condominium if the purchase price exceeds the reasonable value of the property or if the loan has a graduated payment feature. With a VA guaranty, the lender is protected against loss up to the amount of guaranty if the borrower fails to repay the loan.