How to Assume a VA Loan (Yes, Even If You Are Not a Veteran)
By Jesse J. Rivas, Realtor® | Jesse Rivas Realty, Keller Williams Central Valley | Updated October 2026
The Assumable Loan Series
Part 1: What Is an Assumable Loan? A Plain-English Guide for Central Valley Buyers
Part 2: How to Assume an FHA Loan
▶ Part 3: How to Assume a VA Loan (Yes, Even If You Are Not a Veteran)
Part 4: Step by Step: Buying a Home With an Assumable Loan (and Closing the Equity Gap)
Quick Answer
VA loans are assumable, and the buyer does not have to be a veteran. The buyer must be approved by the loan servicer, and usually pays a VA funding fee of 0.5% of the loan balance (some veterans are exempt) plus a capped processing fee. If the buyer is a veteran who substitutes their own VA entitlement, the seller’s entitlement is restored. If not, the seller’s entitlement stays tied to the loan until it is paid off.
As someone who served in the Army Reserves, VA loans are close to my heart. They are one of the best benefits our veterans earned, and assumable VA loans can be a win for both sides of the deal when they are handled correctly. Here is how they work.
Who Can Assume a VA Loan?
For VA loans made on or after March 1, 1988 (nearly all loans today), the buyer must be approved for creditworthiness by the servicer, or by VA in some cases. Beyond that, there are two kinds of buyers:
| Veteran buyer | Non-veteran buyer | |
| Can assume the loan? | Yes, if approved | Yes, if approved |
| VA funding fee | 0.5% of the balance (exempt for eligible veterans, such as those receiving VA disability compensation) | 0.5% of the balance |
| Substitution of entitlement | Available if the buyer has enough entitlement | Not available |
| Seller’s VA entitlement | Restored once substitution is approved | Stays tied to the loan until it is paid off |
| Seller release of liability | Should be requested and confirmed in writing | Should be requested and confirmed in writing |
What Does a VA Assumption Cost?
- VA funding fee: 0.5% of the remaining loan balance, compared with 2.15% or more on a new VA purchase loan with less than 5% down. On a $300,000 balance, that is $1,500.
- Processing fee: VA limits it, generally $300 when the servicer has automatic authority or $250 when VA must approve, with some local variations allowed.
- Normal closing costs: title, escrow, and recording still apply.
- The equity gap: your down payment and/or second loan to cover the difference between price and balance.
If You Are a Veteran Selling Your Home
Offering your VA loan for assumption can make your home stand out, but protect yourself:
- Ask for a release of liability. Without it, you can remain responsible if the buyer stops paying.
- Understand your entitlement. If a non-veteran assumes your loan, your VA entitlement stays tied up until that loan is paid off, which can limit your ability to buy your next home with a VA loan.
- Prefer a veteran buyer who substitutes entitlement if you plan to use your VA benefit again soon. Make substitution a condition of the contract.
- Decide early. Your entitlement decision affects your next purchase, so settle it before you accept an offer.
Jesse’s Tip
For veteran sellers, I recommend writing the substitution and release-of-liability requirements directly into the purchase agreement, and getting the servicer’s written confirmation before closing. It protects your benefit for the next home.
How Long Does It Take?
Plan on roughly 60 to 90 days or more from accepted offer to closing. Timelines depend on the servicer and whether VA needs to review the entitlement substitution.
Frequently Asked Questions
Can a civilian really take over a VA loan?
Yes. Any buyer who meets the servicer’s credit and income requirements can assume a VA loan. The difference is that a civilian cannot substitute entitlement, so the seller’s entitlement stays with the loan.
Is there mortgage insurance on an assumed VA loan?
No. VA loans do not have monthly mortgage insurance. The one-time funding fee replaces it.
Do I have to live in the home?
Servicers and VA generally expect the assuming buyer to occupy the home. Confirm the specific requirement with the servicer before writing an offer.
Can I use a second loan to cover the equity gap?
Often, yes, depending on the servicer and lender. We will need to confirm what the servicer allows. Part 4 covers equity gap options.
Let’s Talk About Your Next Move
Whether you are a veteran, an active-duty family, or a civilian buyer who wants a lower rate, I would be glad to help you figure out if a VA assumption makes sense, and to make sure everyone’s interests are protected.
- Call or text: (510) 506-3800
- Email: JesseRivas@KW.com
- Website: JesseRivas.KW.com | Blog: JesseJRivas.com
- Instagram: @jesse_rivas_realty | Facebook: JesseRivasRealty
- YouTube: @JesseJRivasRealty | TikTok: @jesserivasrealty
- All my links: linktr.ee/jesserivasrealty
Follow along for the rest of this series, Central Valley market updates, and plain-English homebuying education. No pressure, just good information.
Disclosure
This article is for general educational purposes only and is not legal, tax, or lending advice. Loan assumption rules, fees, and approval are set by FHA, VA, USDA, and each loan servicer, and can change. Always confirm details with the loan servicer, a licensed loan officer, and your own advisors. Example numbers are illustrations, not quotes or rate offers. Jesse J. Rivas, Realtor®, DRE #02282782. Keller Williams Central Valley, Broker DRE #02324551.
Next in the series: Part 4, Step by Step: Buying a Home With an Assumable Loan.
