• What's at Stake: Lenders risk losing $41 billion in potential loan volume from eligible military borrowers.
• Expert Quote: "Education and awareness are significant pieces of the puzzle," — Chris Birk, Vice President of Mortgage Insight, Veterans United Overview bullets generated by AI with editorial review.

Mortgage lenders could have made approximately 83,100 mortgages, representing $41 billion in volume in 2025 through the Veterans Affairs mortgage guarantee program, an analysis from Veterans United Home Loans found.

This was an increase from a $37.9 billion gap one year prior.

The share of VA loans originated remains lower than the number of eligible borrowers in dozens of housing markets, the report claimed.

Why aren't eligible borrowers seeking a VA mortgage

"Education and awareness are significant pieces of the puzzle," said Chris Birk, vice president of mortgage insight at Veterans United. "Some Veterans may not fully understand the benefits they've earned, while others may be working with real estate agents who aren't as familiar with VA financing."

Birk also pointed to the persistent misconceptions about VA loans which can influence how borrowers, agents and sellers approach these transactions which seek this form of financing.

Past surveys, including one from Navy Federal Credit Union, showed many veterans had erroneous ideas about the VA program, including not being aware it offers 100% loan-to-value ratio mortgages.

A NewDay USA survey from this past April of current or past servicemembers and reservists found that about 13% said they were extremely well educated, with 20% very well educated, about their mortgage benefit. The leading response was somewhat at 35%, followed by hardly at 19% and not well educated at all by 13%.

What is the role of housing affordability in the VA use gap

Part of the problem might be general affordability. Just under 8% of homes for sale as of Oct. 23 were within the reach of a veteran who earns his or her local median income, with a 100% LTV, a study from Movoto by Lower stated.

The study used the then-current 7.32% average rate for a VA mortgage at 28% of median income for veterans who live in a particular metro area.

Movoto found 86,277 of over 1.11 million homes listed for sale in 196 metro areas were affordable to this group; the data did not include calculations for taxes and insurance, which also impacts monthly mortgage payments.

Nationwide, veterans represent 6.2% of the adult population. The largest numbers are in New York City, Washington and Dallas-Fort Worth. But the highest shares for where veterans live are in Jacksonville, North Carolina, 21.8%; Killeen-Temple, Texas, 19.2%; and Fayetteville, North Carolina, 18%. All three are where large military installations are located, Movoto said.

Where are the opportunities to market VA mortgages

In the Veterans United study, New York is also the largest metro for untapped VA borrowers. The study looked at estimates of potential lender opportunity for these loans, so it did not take into account veterans who used another mortgage product to purchase a home.

"The geographic differences are telling," Birk said. Markets with a strong military presence, those close to bases for example, tend to have higher VA loan utilization. But in some metros with larger veteran populations, they might not have as much knowledge about the program.

"That suggests awareness could be playing an important role," Birk said. It's not necessarily that Veterans are being denied access to the benefit, but many may not be getting the information or guidance they need to fully explore it. "That's something the entire industry can work to improve," he said.

It estimated how many VA mortgages could be made in a metro area if its usage reached the national benchmark.

In the New York metro area, it said an additional 3,597 loans could be made. This was followed by Philadelphia and nearby cities at 2,678 and Chicago at 2,410. Los Angeles was fourth at 2,305.

Meanwhile, Movoto said Macon, Georgia is the market where veterans can afford the largest share of homes for sale, at 35.6%. Youngtown, Ohio was next at 34.9%, followed by Pittsburgh at 30.9%.

How many VA mortgage apps were received this week

The Mortgage Bankers Association's Weekly Application Survey put the VA share of total applications for the period ended Nov. 6 at 12.4%, up from 11.2% the week prior.

In comparison, the share of Federal Housing Administration mortgages fell to 15.5% from 16%.

"Applications for conventional, VA and FHA purchase applications saw gains over the week, with particularly strong growth for FHA and VA loans," said Joel Kan, the group's deputy chief economist, in a press release. "Refinance applications also saw a relatively strong week, with a big rebound in VA refinance applications over the past two weeks."

The MBA does not have data on how many of those refis were the VA Interest Rate Reduction Refinance Loan, versus mortgages coming from another product like conventional or FHA.

How many borrowers locked a VA mortgage in October?

The Optimal Blue Market Advantage report for October found the 30-year VA mortgage averaged 6.76% compared with 7.15% for conforming and 7% for FHA.

VA had 11.4% share of October rate locks, versus 46.1% for conforming, 29.1% for non-conforming and 19.9% for FHA.

But only 47% of the VA lock volume was first-time buyers, similar to the conforming level but well below the 70% for FHA, Optimal Blue said.

Birk pointed out the company's research found that VA loans gained overall mortgage market share in 2025, but much of this growth came from refinancing rather than purchase lending. Still, VA loans accounted for 9.22% of home purchase originations in 2025, compared with 8.88% the year before.

Yet meaningful work remains on the purchase side to increase adoption.

"The biggest thing originators can do is prioritize VA loan education, both for their clients and for themselves," Birk said.

Veterans United still encounters misconceptions about VA appraisal requirements, closing timelines and what factors make a VA-backed offer competitive. "The more comfortable agents and lenders are with the program, the better positioned they are to serve veteran homebuyers," said Birk.

For buyers, using a lending professional who can explain and do the comparison for the pros and cons of each product type can make a huge difference, he said.