VA Loan Assumptions Explained: A Hidden Opportunity for Military Buyers

As interest rates remain higher than in previous years, military buyers in San Antonio are searching for creative ways to make homeownership more affordable. One powerful but often overlooked option is the VA loan assumption. 
This strategy allows a qualified buyer to take over the seller’s existing VA loan—including its lower interest rate—potentially saving thousands over the life of the loan. 

With 18 years of experience serving military clients, Tami Price, REALTOR®, explains what VA loan assumptions are, how they work, and why they can be a smart move for service members relocating to Military City USA. 

What Is a VA Loan Assumption? 

A VA loan assumption allows a buyer to assume, or take over, an existing VA-backed mortgage from the seller. 
This means the buyer inherits the seller’s: 

• Interest rate 

• Remaining loan balance 

• Loan term 

• Monthly payment schedule 

Instead of applying for a brand-new mortgage at today’s higher rate, the buyer continues paying on the existing one—often locking in significant savings. 

Why VA Loan Assumptions Are Popular in 2025 

Many VA loans originated between 2019 and 2022 when interest rates ranged from 2.25% to 4%. 
With current market rates closer to 6–6.5%, assuming an older VA loan can make a huge difference in affordability. 

For example, taking over a $400,000 loan at 3% instead of 6.5% can reduce the monthly principal and interest payment by several hundred dollars. That difference allows military families to stretch their housing budgets further, particularly during a PCS relocation. 

Who Can Assume a VA Loan? 

A VA loan can be assumed by: 

• Another eligible veteran using their own VA entitlement, or 

• A civilian buyer, if the lender approves and the buyer meets credit and income requirements. 

However, for the seller’s VA entitlement to be restored, the buyer must be an eligible veteran willing to substitute their own entitlement. 
If a civilian assumes the loan, the seller’s entitlement remains tied to the property until it’s fully paid off. 

This distinction is critical for sellers planning to use their entitlement again in the future. 

The VA Loan Assumption Process 

1. Confirm Assumability: 
   The seller’s loan servicer must verify that the loan is assumable and provide detailed instructions.

2. Buyer Qualification: 
   The buyer applies directly with the current loan servicer, who evaluates credit, income, and debt ratios to ensure repayment capability. 

3. Determine Equity Difference: 
   The buyer must pay any difference between the purchase price and the remaining loan balance—known as the equity gap. 

4. Lender and VA Approval: 
   The servicer reviews the application and issues final approval. This step may take 30–60 days depending on workload. 

5. Closing: 
   Once approved, the buyer assumes the mortgage, and the seller’s name is released from liability if substitution of entitlement is granted. 

Benefits for Military Buyers 

• Lower Interest Rate: Take advantage of a rate often 2–3 percentage points below current market levels. 

• Reduced Monthly Payment: Lower interest means long-term savings and easier budgeting. 

• Fewer Closing Costs: Many assumptions avoid traditional origination fees and appraisal costs. 

• Simplified Process: No new underwriting for the loan itself—only qualification for the assumption. 

For service members transferring under PCS orders, these savings can make relocating smoother and more financially manageable. 

Important Considerations Before Assuming 

While VA loan assumptions offer clear advantages, they also include details that buyers should understand: 

• Equity Requirement: Buyers must cover the difference between the home’s price and remaining loan balance. 

• Processing Timeline: Servicer approval can take several weeks longer than a standard transaction. 

• Entitlement Substitution: Only another eligible veteran can restore the seller’s entitlement. 

• Funding Fee: Assumptions may include a small funding fee (0.5%) compared to new loan originations (up to 3.6%). 

Working with an experienced Realtor who understands VA guidelines ensures these factors are addressed early, keeping the process on schedule. 

How to Find VA-Assumable Homes in San Antonio 

Not every listing advertises its assumability, so partnering with a Realtor familiar with VA financing is essential. 
Tami Price, REALTOR®, regularly identifies assumable listings throughout Redbird Ranch, Riverstone at Westpointe, Cibolo, and Schertz, where VA-backed loans are common. 

She also collaborates with loan servicers to confirm assumability and verify accurate rate, balance, and payment details before buyers submit offers. 

When an Assumption Makes the Most Sense 

A VA assumption may be ideal if: 

• You’re an eligible veteran relocating to San Antonio under PCS orders. 

• You want to buy in a higher-value neighborhood while keeping monthly costs manageable. 

• You plan to stay in the home long enough to benefit from long-term interest savings. 

In these cases, an assumable VA loan can be one of the most powerful financial tools available to a military buyer. 

Why Local Expertise Matters 

Not every agent understands how VA assumptions work—or how to guide clients through the extra steps involved. 
As an Air Force veteran and relocation expert, Tami Price has extensive experience coordinating with servicers, lenders, and title companies to complete VA assumptions smoothly. 

Her knowledge of San Antonio’s market, combined with hands-on experience navigating entitlement and approval timelines, helps clients make informed, confident decisions. 

The Bottom Line 

VA loan assumptions can open doors for military buyers relocating to San Antonio. By taking over an existing low-interest VA loan, buyers can reduce monthly costs, preserve savings, and build long-term equity more efficiently. 

Before pursuing an assumption, it’s critical to work with a Realtor who understands the process from both the real-estate and lending perspectives. 

Tami Price, REALTOR®, provides the specialized expertise military buyers need to make the most of this unique opportunity. 

Contact Tami Price, Realtor.