By Louay Yousif, Mortgage Advisor
PRMG — Paramount Residential Mortgage Group
NMLS #1515287 | San Diego, CA
Last Updated: November 25, 2025
Equal Housing Lender. All loans subject to approval.

Veterans, active-duty service members, reservists, and surviving spouses have access to one of the most powerful home financing programs in the country: the VA home loan.

After nearly 30 years in the mortgage industry, I’ve seen every type of loan in every type of market. And nothing delivers more real buying power—especially in California—than a properly structured VA loan.

• Zero down payment.
• No monthly mortgage insurance.
• Flexible qualification requirements.
• Lower interest rates.

And in 2025, eligible VA buyers can also receive up to 2% in lender credits (capped at $21,000)—a benefit that can eliminate closing costs entirely when structured correctly.

This guide breaks down everything you need to know using real California numbers, including a documented San Diego settlement statement.

Why VA Loans Are So Strong in California

Zero Down Payment

Eligible buyers can finance 100% of the purchase price, even in high-cost areas like San Diego, Riverside, Orange County, and Los Angeles.

No Monthly Mortgage Insurance

Unlike FHA and conventional loans, VA loans never require monthly mortgage insurance (MI), saving hundreds per month.

The VA Does Not Require a Minimum Credit Score

The VA does not set a minimum score.
They evaluate your full financial picture—especially residual income, which measures the money left over after all debts and living expenses.

Most lenders require 580–620, but a well-structured file with strong compensating factors can qualify below these thresholds.

Lower Interest Rates

VA loans typically offer lower interest rates than FHA or conventional, thanks to the VA guarantee.

Flexible DTI (Debt-to-Income): A Major Advantage for Veterans in California

Most mortgage programs rely heavily on Debt-to-Income Ratio (DTI):

DTI = Total Monthly Debts ÷ Gross Monthly Income

Example:
If your debts are $3,000/month and income is $6,000/month → 50% DTI.

Hard stops for most programs:

• Conventional: ~45% (Some Programs allow up to 50%)
• FHA: ~50%

If you exceed those limits, the loan usually stops.

VA Loans Are Different

VA underwriting focuses on Residual Income, not a strict DTI cutoff.

This allows approvals up to:

DTI of 61.99% (VA approvals commonly reach up to 61.99% DTI, and in some cases higher, depending on residual income and AUS findings.)

This is common in California, where cost of living, car payments, and insurance averages are higher than the rest of the country.

Higher allowable DTI = more buying power, especially for first-time VA buyers.

2025 Advantage: Up to $21,000 in Lender Credits

PRMG offers a lender credit of up to 2% of the loan amount, capped at $21,000, which can be applied to:

• Closing costs
• Prepaid taxes and insurance
• Discount points (permanent rate buy-downs)
• Certain debt payoffs (case by case)

This credit can be leveraged to reduce or completely eliminate cash to close.

Here’s a real example.

Real Example: A $570,000 VA Purchase With All Costs Covered

(Based on a documented San Diego settlement statement)

• Purchase Price: $570,000
• Loan Amount: $582,255
• Total Closing Costs: Just over $19,000
• 2% Lender Credit: $11,645.00
• Seller Credit: $10,000.00
• Total Credits: $21,000.00

Outcome:

All closing costs—including title, escrow, lender fees, VA funding fee, impounds, prepaid interest, HOA dues, and recording fees—were covered.

The buyer even received their $5,700 earnest money deposit refunded.

This is the power of proper VA structuring.

California-Accurate Closing Cost Ranges (Based on Real Data)

Using the documented $570,000 San Diego file as our baseline, here are realistic VA closing cost ranges in California:

These numbers reflect real California closing costs—not national averages.

Who Qualifies for a VA Loan? (Updated Eligibility Rules)

Eligibility depends on service history, duty status, and discharge conditions.

Active-Duty Service Members

You may be eligible with:

• 90 consecutive days of active duty during wartime
• 181 continuous days of active duty during peacetime
• Less than 90 days if discharged due to a service-connected disability

National Guard & Reserves

You may qualify with:

• 6 creditable years in the National Guard or Reserves
• 90 days under Title 32 orders, including 30 consecutive days

Surviving Spouses

You may be eligible if your spouse:

• Died in the line of duty
• Died from a service-connected disability

Eligibility Exceptions (Discharges That Still Qualify)

You may qualify if discharged due to:

• Hardship
• Convenience of the government (requires 20 months of a 2-year enlistment)
• Early out (requires 21 months of a 2-year enlistment)
• Involuntary reduction in force
• Certain medical conditions
• A service-connected disability

These exceptions allow many veterans to keep their VA home loan benefits even without completing full service time.

Common Questions From California VA Buyers

Can I qualify with a 580 credit score?
Possibly. VA evaluates the entire financial profile, including residual income.

Can I use my VA loan more than once?
Yes. You can restore entitlement—or hold two VA loans simultaneously with remaining entitlement.

Can I buy a duplex, triplex, or fourplex?
Yes, as long as you occupy one unit.

Do VA loans take longer to close?
Not with an experienced VA lender. Most of my VA purchases close within 30 days.

Can I buy a fixer-upper?
Yes, using the VA Renovation Loan (purchase + repairs).

Are there loan limits in California?
Not with full entitlement.
VA buyers regularly purchase above $1M in high-cost counties.

My VA Loan Process (Step-by-Step)

• COE Verification – I pull your COE directly through the VA portal—usually within minutes.
• Pre-Approval – Clear numbers, no guesswork, no pressure.
• Home Search – Use your agent or one of my VA-experienced partners.
• Offer Strategy – We position your VA offer strongly in competitive markets.
• VA Appraisal & Underwriting – Tight communication keeps everything moving smoothly.
• Closing – Zero down payment. No mortgage insurance. Up to $21,000 in lender credits.

Why Work With a VA Specialist?

VA loans have unique rules, guidelines, and opportunities that most lenders don’t fully understand.

Across nearly three decades, I’ve helped:

• First-time VA buyers
• Active-duty families relocating to California
• Veterans restoring entitlement
• Buyers using VA for multi-unit properties
• High-balance VA borrowers
• Clients maximizing lender credits to reduce or eliminate cash-to-close

A well-structured VA loan can save thousands and strengthen your offer.
A poorly structured VA loan can cost you the home.

Ready to Use Your VA Benefits?

I’ll help you:

• Pull your COE
• Calculate your VA buying power
• Maximize lender credits
• Get pre-approved within 24–48 hours

📞 Call/Text: 619-954-3446
📧 Email: LYousif@prmg.net
🌐 Website: https://LouayYousif.com
📅 Book time to meet with me