The VA funding fee ranges from 0.5% to 3.3% of your loan amount depending on loan type, down payment, and whether it's your first VA loan. Here's the full 2026 fee chart, who's exempt, how refunds work, and what it means for Colorado Springs military buyers.
VA Loan in Colorado: Eligibility & Benefits
Last updated: June 30, 2026 — figures such as the Colorado Springs median home price, conventional down-payment percentages, and the VA funding fee are general and change over time; confirm current numbers with your lender.
A VA loan is a mortgage backed by the U.S. Department of Veterans Affairs that lets eligible Colorado veterans, active-duty service members, and certain surviving spouses buy a primary home with $0 down and no monthly mortgage insurance. You qualify through service-based eligibility (a Certificate of Eligibility), then meet a lender’s credit and income standards. It’s one of the strongest loans available in the Colorado Springs market.
With Fort Carson, Peterson Space Force Base, Schriever, and the Air Force Academy all anchored in El Paso County, Colorado Springs has one of the densest military and veteran populations in the country. The VA loan is built for exactly this buyer base — and as a local broker, it’s one of the most common loans we structure. This pillar walks through eligibility, the core benefits, and how the funding fee actually works.
Who is eligible for a VA loan in Colorado?
Eligibility is based on your service history, not your zip code — the same federal rules apply in Colorado Springs as anywhere else. You generally qualify if you meet a minimum length-of-service requirement and obtain a Certificate of Eligibility (COE) from the VA. The main groups who qualify:
- Veterans who met active-duty service minimums and were not dishonorably discharged.
- Active-duty service members — common around Fort Carson — typically after about 90 continuous days of service.
- National Guard and Reserve members who meet the VA’s service thresholds.
- Surviving spouses of service members who died in the line of duty or from a service-connected disability, in certain cases.
Service-length minimums vary by era and duty type, so confirm yours against current VA guidance. The COE is the document that proves your entitlement — your lender can usually pull it electronically in minutes, or you can request it through VA.gov.
What are the main benefits of a VA loan?
The headline benefits are $0 down and no monthly mortgage insurance — a combination no other major loan program offers. For a Colorado Springs buyer, that’s the difference between needing tens of thousands of dollars up front and getting into a home with closing costs alone.
| Feature | VA Loan | Conventional | FHA |
|---|---|---|---|
| Minimum down payment | $0 | Typically 3%–5% | 3.5% |
| Monthly mortgage insurance | None | PMI if under 20% down | MIP required |
| One-time upfront charge | VA funding fee (can be financed) | None | Upfront MIP |
| Who can use it | Eligible military/veterans | Anyone qualified | Anyone qualified |
| Primary residence required | Yes | No (occupancy varies) | Yes |
Beyond the two big ones, VA loans are competitive on rate, allow the seller to cover certain costs, and have no prepayment penalty. There’s also no private mortgage insurance to cancel later — it simply never exists on the loan. For a deeper look at how these compare locally, see our Colorado Springs mortgage broker overview.
How does the VA funding fee work?
The VA funding fee is a one-time charge that helps keep the program running without ongoing mortgage insurance. It’s a percentage of the loan amount, and the rate depends on your down payment and whether it’s your first time using a VA loan. You can pay it at closing or roll it into the loan.
Two things that matter most for Colorado buyers:
- Repeat use costs more. The funding fee is lower the first time you use your VA benefit and higher on subsequent uses (unless you make a down payment, which lowers it).
- Many disabled veterans are exempt. Veterans receiving VA compensation for a service-connected disability — and certain surviving spouses — are generally exempt from the funding fee entirely. This is a major saving and worth confirming on your COE.
Because the fee can be financed, it doesn’t break the $0-down advantage — but it does increase your loan balance slightly, so it’s worth modeling both ways. Confirm current funding-fee percentages with your lender, as the VA publishes the exact schedule.
Why is the VA loan so popular around Fort Carson and Colorado Springs?
Because the buyer base is here. El Paso County is home to tens of thousands of active-duty service members and one of the largest veteran populations in Colorado, and the VA loan is purpose-built for them. In a market where the median home price typically sits in the mid-$400,000s, a 5% conventional down payment is over $20,000 — money many younger service members at Fort Carson simply don’t have saved. The VA loan removes that barrier.
A common local scenario: a service member receiving Basic Allowance for Housing (BAH) uses that allowance to support the mortgage payment, buys with $0 down, and builds equity instead of renting. We see this play out constantly across Colorado Springs, Fountain, and Security-Widefield. If you’re weighing your options, our guide to first-time home buying in Colorado Springs and our current mortgage rate overview pair well with this one.
What are the limits and requirements to keep in mind?
A VA loan is generous but not unconditional. Key requirements:
- Primary residence only. VA loans are for the home you’ll live in — not pure investment property.
- Lender credit and income standards still apply. The VA backs the loan, but you still qualify through a lender. There’s no single national minimum credit score set by the VA; lenders set their own.
- The home must meet VA appraisal standards. The property has to satisfy the VA’s Minimum Property Requirements for safety and livability.
- Entitlement matters. Full entitlement generally means no loan limit on what the VA will back with $0 down; partial or used entitlement can change that.
Frequently asked questions
Do you really put zero down on a VA loan in Colorado?
Yes. Eligible buyers can finance 100% of the purchase price on a primary home with no down payment, which is the program’s signature benefit. You’ll still pay closing costs and, in most cases, the VA funding fee, though the fee can be rolled into the loan.
Is there mortgage insurance on a VA loan?
No. VA loans have no monthly mortgage insurance — unlike conventional loans (PMI under 20% down) or FHA loans (MIP). That’s one of the biggest monthly-payment advantages of the program.
Can I use a VA loan more than once?
Yes. Your VA benefit can be reused as you pay off or sell prior VA-financed homes and restore entitlement. The funding fee is typically higher on subsequent uses unless you make a down payment, so plan for that.
Do disabled veterans pay the VA funding fee?
Generally no. Veterans receiving VA compensation for a service-connected disability are usually exempt from the funding fee, and certain surviving spouses qualify for exemption too. Your Certificate of Eligibility will reflect this — confirm it with your lender.
What credit score do I need for a VA loan?
The VA itself doesn’t set a minimum score; individual lenders do. Standards vary, so it’s worth talking to a broker who can match you to the right lender rather than assuming you don’t qualify. Confirm current requirements with your lender.
If you’re a veteran or service member in Colorado Springs weighing whether a VA loan fits your situation, reach out to 719 Lending. As a local broker, we can pull your COE, model the funding fee both ways, and walk you through the numbers for the El Paso County market — no pressure, just clear answers.
719 Lending Inc., NMLS #1601989 · Equal Housing Opportunity · This article is educational only, is not a commitment to lend, and not all applicants will qualify. 719 Lending is not affiliated with or endorsed by any government agency.
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