Who’s using VA loans around here
Between the Navy Yard, the old Willow Grove air station, and the VA Medical Center on Woodland Avenue, there are eligible buyers in all five counties, and plenty of them have never used the benefit. It’s for veterans, active-duty service members, National Guard and Reserve members who meet the service requirements, and certain surviving spouses. The lender can request your Certificate of Eligibility directly from VA, so you don’t have to chase paperwork before the first call.
The benefit is simple to describe. No down payment, no monthly mortgage insurance, and a one-time funding fee that can be rolled into the loan. Around Philadelphia, that combination lands differently depending on which side of City Avenue you buy.
Zero down, and what still costs money
Here’s a $300,000 purchase in the city and one in a standard 2% suburb, for a first-time user of the benefit with nothing down.
| Line | Philadelphia | Suburbs at 2% |
|---|---|---|
| Down payment | $0 | $0 |
| Buyer’s half of transfer tax | $6,867 | $3,000 |
| Funding fee, first use at 2.15% | $6,450, financed | $6,450, financed |
| Owner’s title policy | $2,165 | $2,165 |
The funding fee rides in the loan. The transfer tax and title policy get paid at the table, and seller assist is how a lot of Philadelphia VA buyers cover them. Radnor, Upper Darby, Tredyffrin, and the City of Chester charge 2.5% instead of 2%, and Upper Providence charges 3%. Details in the transfer tax guide.
The funding fee table
VA charges a one-time funding fee in place of monthly insurance. The rates below have been unchanged since April 2023.
| Down payment | First use | After first use |
|---|---|---|
| Under 5% | 2.15% | 3.3% |
| 5% to 9.99% | 1.5% | 1.5% |
| 10% or more | 1.25% | 1.25% |
An IRRRL, the VA streamline refinance, charges 0.5%. A VA cash-out refinance charges 2.15% on first use and 3.3% after. Putting 5% down on that $300,000 house cuts the fee from $6,450 to $4,275, which is worth running if you have the cash and don’t need it for the transfer tax.
You’re exempt if you receive VA compensation for a service-connected disability, if you’d be eligible for it but draw retirement or active-duty pay instead, if you’re a surviving spouse receiving DIC, or if you’re an active-duty Purple Heart recipient. On the example above the exemption is worth $6,450, so make sure the lender checks.
No loan limit, with one catch
With full entitlement there is no VA loan limit. If the appraisal supports the price and you can afford the payment, VA backs it. That matters on the Main Line and in Chester County, where a lot of houses sit above the $832,750 conforming limit, and a VA buyer can go there with nothing down while a conventional buyer is assembling a jumbo down payment.
The catch is partial entitlement. If you still have a VA loan open or lost entitlement on a past one, the county limit of $832,750 drives the guaranty calculation, and above it the lender may need a down payment to make the math work. The lender reads your remaining entitlement off the certificate before you start touring, and it’s the first thing to ask about on the call.
What the VA appraiser flags in a 1940s twin
VA’s Minimum Property Requirements are close cousins of FHA’s, and the region’s pre-war housing triggers them regularly. Safe, sound, and sanitary is the standard. In practice the appraiser is looking for:
- A roof with useful life left, commonly read as at least two years.
- Working permanent heat, safe electrical, and no exposed wiring.
- Peeling or chipping paint on a pre-1978 house, which must be corrected.
- A wood-destroying insect inspection, because Pennsylvania is a required-inspection state for VA.
- Legal all-weather access, a dry ventilated crawl space, working water and sewer.
Repairs get done before closing, and who pays is negotiated. Read the rowhome appraisal guide before you write on a Havertown twin whose porch hasn’t seen paint since the Phillies won in 2008. VA updated a few of these rules in May 2026, so ask the lender which items still apply to the house you’re looking at.
PHFA with a VA loan
PHFA’s Keystone Government Loan takes a VA first mortgage with no PHFA income or price limits and no first-time-buyer requirement, and pairs it with the Keystone Advantage second, up to $6,000 at 0% repaid over ten years. That’s a way to cover the transfer tax on a zero-down purchase without leaning on seller assist. Borrowers under a 680 score take a homebuyer course. See the PHFA guide.
Zero down does not mean zero cash. In the city, a VA buyer on a $300,000 house still owes $6,867 in transfer tax at the table, and that number can’t be rolled into the loan. Plan for it, negotiate seller assist, or use the PHFA second to cover it.
Start with one call
Tell us whether you’ve used your benefit before and where you’re looking. The lender you get does VA loans on this region’s older houses and starts with your entitlement certificate. Call us.