The VA loan program bounced back this fiscal year, reversing a slowdown seen in FY 2024 before, showing the market the durability of this benefit, according to a recent analysis from Veterans United Home Loans, the country's largest VA lender.
According to a Dec. 10 release, total VA lending climbed 26.8 percent year over year, rising to 528,343 loans from 416,363 in 2024. And overall, VA purchase loans rose 8.5 percent year over year, to 323,835 from 298,327, reversing last year's sharp five percent decline from FY23.
Gen Z played an outsized role in the VA program's resurgence during the fiscal year ending Sept. 30, and was the only cohort of military buyers to post purchase gains this past year. Gen Z VA purchase loans jumped 38 percent on the year. to 47,802 from 34,616.
"Gen Z is expanding its footprint faster than any other group of VA buyers," said Chris Birk, vice president of mortgage insight at Veterans United Home Loans. "They're entering the market at a time when affordability is a real challenge, and the VA loan's hard-earned benefits are helping them compete and succeed. Their growth is reshaping what the next decade of military homebuying will look like."
The fastest-growing destinations for Gen Z VA buyers included major metros and traditional military hubs across Texas, North and South Carolina, and California. These markets posted growth well above the national average for this age group, highlighting where the youngest veterans and service members are choosing to put down roots.
Baby Boomers were next with nearly a seven percent rise, followed by Millennials with a 5.42 percent increase.
While activity remains below historic highs from the pandemic era, refinancing was again a significant part of the VA lending landscape as borrowers looked for opportunities to improve their rate or tap equity. Total VA refinances jumped 73.2 percent this year, with cash-out refinances accounting for slightly over a quarter of that activity, per the release.
To view the full report, visit here.
Reach Julia LeDoux at Julia@connectingvets.com.