VA lending took a sharp upturn in 2025

The U.S Department of Veterans Affairs (VA) home loan program rebounded sharply in 2025, according to a new analysis from Veterans United Home Loans. The rebound reverses last year’s slowdown and highlights the program’s continued appeal for service members and veterans.

VA loan count rose 26.8% to 528,343 loans closed in fiscal year 2025, up from 416,363 in fiscal year 2024.

Veterans United says much of the growth came from a steadier purchase market and a surge in refinancing, signaling renewed confidence amid ongoing affordability challenges.

VA purchase loans increased 8.5% to 323,835, a turnaround from a 5% decline the year before.

Generation Z played an outsized role in the rebound. The youngest cohort of military borrowers accounted for 38% of VA loan activity and led all age groups in purchase growth, far outpacing baby boomers, millennials, Gen X, and the Silent and Greatest generations.

“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 when affordability is a real challenge, and the VA loan’s benefits are helping them compete and succeed.”

Refinancing also surged. Total VA refinances climbed 73.2% year over year, with cash-out refinances rising 26.5%. While still below pandemic-era high points, the spike shows borrowers are actively using VA loans to lower their monthly payments or tap into home equity.

The fastest-growing markets for Gen Z VA buyers included major metros and military hubs across Texas, the Carolinas and California, reflecting locations where younger service members and veterans are settling.