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A VA loan is a home loan program backed by the U.S. Department of Veterans Affairs (VA). It is available to eligible veterans, active-duty service members, National Guard members, and some surviving spouses.
Key features of a VA loan:
No down payment required (in most cases)
No private mortgage insurance (PMI)
Lower interest rates than many conventional loans
More flexible credit requirements
VA loans can be used to buy, build, or refinance a primary residence.
A VA One-Time Construction Loan enables eligible borrowers to build a home and finance it with a single loan, rather than taking separate construction and mortgage loans.
Key features:
One loan covers both construction and permanent mortgage
No down payment required (for most borrowers)
No PMI
Backed by the VA
After construction is complete, the loan automatically converts into a permanent VA mortgage
This loan is ideal for veterans who want to build a custom home rather than buy an existing one.
A Jumbo loan is a mortgage that exceeds the conforming loan limits set by the Federal Housing Finance Agency (FHFA).
Key features of a Jumbo loan:
Used for higher-priced homes
Higher loan amounts than conventional loans
Typically requires higher credit scores
Often requires a larger down payment
May have stricter income and asset requirements
Jumbo loans are common in high-cost housing areas.
For eligible veterans in Illinois, VA loans combine zero down payment, no private mortgage insurance, and relaxed credit guidelines to make buying or building a home more affordable and accessible than most conventional or FHA loans.
The VA One-Time Close Construction Loan allows Illinois veterans to build a home using one loan, one closing, and no refinance after construction. This program is popular in Illinois due to available land, older housing stock, and rising renovation costs.
Everything is combined into one VA loan, helping protect against rate changes and eliminating the need to re-qualify.
VA One-Time Close Construction Loans have no official loan limit for borrowers with full VA entitlement. Higher loan amounts may be available, including VA Jumbo construction loans, subject to lender guidelines, entitlement, and borrower qualification.
Veterans purchasing higher-priced homes in Illinois may qualify for a VA Jumbo Loan, allowing them to buy above standard conforming loan limits, often with no down payment, when entitlement and income support the loan amount. Higher-cost markets such as Naperville, Lake County, DuPage County, Chicago suburbs, and North Shore communities frequently exceed conforming limits, making VA jumbo financing an important option.
VA loans do not have an official loan limit for borrowers with full VA entitlement. This allows eligible veterans to obtain high-balance or jumbo VA loans based on lender guidelines.
Key limit considerations:
VA jumbo loans follow VA guidelines and may include lender-specific overlays, making an experienced Illinois VA jumbo lender essential.
Not all VA lenders offer construction financing. Veterans building in Illinois must work with a VA construction loan lender approved to handle:
Choosing the right lender is critical; most VA construction delays occur due to lenders' unfamiliarity with VA-specific construction requirements. Veterans working with experienced Illinois VA construction lenders benefit from smoother closings, fewer delays, and clearer expectations from start to finish.
A VA Refinance Loan in Illinois allows eligible veterans and service members to refinance an existing mortgage to lower their interest rate, reduce monthly payments, or access home equity.
VA refinance options are available for primary residences only and follow VA guidelines, with flexible credit and income requirements.
Designed to lower interest rates on existing VA loans with minimal documentation and no appraisal in most cases.
Allows veterans to refinance and access home equity for debt consolidation, home improvements, or other financial needs.
Our team at Security America Mortgage makes every effort to ensure the home buying process as transparent and stress free as possible.
Our team at Security America Mortgage makes every effort to ensure the home buying process as transparent and stress free as possible.
Are you ready to take advantage of your VA loan benefits? If so, it’s simple to start the process and takes only a few minutes. No social security number needed to start!
Active service members with at least 90 continuous days of service and Veterans who’ve been honorably discharged from the armed forces can apply for a VA loan. Get started today!
Illinois offers unique opportunities and challenges for veterans using a VA loan. From higher property taxes and older housing stock to strong land availability in growing suburbs, Illinois is especially well-suited for VA construction loans and one-time close construction financing.
This page focuses specifically on how VA loans work in Illinois, what veterans need to know before buying land or building a home, and why many Illinois veterans choose to build rather than buy existing homes.
For general VA loan eligibility and benefits. VA Loan Guide
VA loans in Illinois follow national VA guidelines, but state-level factors can significantly affect affordability, property choice, and long-term costs.
Illinois-specific considerations include:
Property taxes that are higher than the national average
Large variation by county and municipality
Older housing stock in many cities
Strong suburban and semi-rural land availability
Zoning and appraisal considerations for new construction
Because of these factors, many Illinois veterans find that building a home with a VA loan offers better long-term value than purchasing an existing property.
The VA does not allow standalone land loans. However, veterans can buy land as part of a VA construction loan, provided construction begins immediately.
This is especially relevant in Illinois, where many veterans:
Already own land inherited or purchased years earlier
Are looking to build outside dense metro areas
Want to use existing land equity toward construction
Best Places to Buy Land in Illinois Guide
Counties outside Chicago including Will, Kane, Kendall, McHenry, Madison, and Champaign, frequently attract veterans building custom homes with VA financing.
Illinois offers a wide range of build-friendly locations depending on lifestyle, commute, and budget.
Military installations play a major role in VA loan usage in Illinois, particularly for veterans who retire locally or relocate from other states and choose to build.
Scott Air Force Base is one of the strongest drivers of VA loan demand in Illinois.
Veterans commonly build homes in:
O’Fallon
Belleville
Shiloh
Edwardsville
These areas offer:
Available land
Growing new-construction communities
Strong demand for VA One-Time Close construction loans
Our team here at Security America Mortgage are experts when it comes to helping veterans obtain VA Home Loans. If you’re ready to get started complete the simple form above and one of our mortgage specialists will contact you shortly. We look forward to working with you!
Naval Station Great Lakes is the only Navy boot camp in the United States, creating a constant flow of service members transitioning to veteran status.
Veterans often build homes in:
Lake County
McHenry County
Northern Chicago suburbs
New construction is often preferred due to older housing stock near the base.
Rock Island Arsenal supports long-term civilian and military employment, leading many veterans to remain in the Quad Cities region.
This area sees:
Semi-rural construction
Veterans who already own land
Strong demand for VA construction loans in western Illinois
The following builders are frequently considered by veterans building homes in Illinois (not endorsements):
VA loan rates change daily and depend on:
Because of this, we do not publish fixed interest rates.
Veterans can estimate payments using our calculators:
The process usually begins with:
Veterans building in Illinois benefit most from working with lenders experienced in VA construction lending, not just standard VA purchase loans.
Explore VA loan guidance, benefits, and build options for the states we currently serve.
VA benefits and eligibility rules are federal guidelines. State pages highlight local housing and build considerations.
For building, veterans typically use a VA One-Time Close Construction Loan through a lender experienced in VA construction.
A VA loan is a mortgage backed by the U.S. Department of Veterans Affairs that helps eligible veterans, active-duty service members, and surviving spouses buy, build, or refinance a primary residence. VA loans typically offer no down payment, no PMI, competitive interest rates, and flexible credit guidelines.
Illinois offers several first-time homebuyer assistance programs, including grants and forgivable loans that can provide up to $7,500 or more for down payment and closing costs. Availability depends on income limits, purchase price, location, and program funding. These programs may be combined with VA loans if eligibility requirements are met.
The “4% rule” generally refers to the VA funding fee, which is a one-time fee paid to help sustain the VA loan program. For most first-time VA borrowers, the funding fee is 2.15% (not 4%), and it may be higher for repeat use.
The Illinois Veterans Grant (IVG) provides tuition assistance (not a housing grant) to eligible Illinois veterans attending in-state public colleges or universities. Eligibility is based on military service, Illinois residency, and honorable discharge. While it’s not a mortgage program, many veterans use IVG benefits alongside VA home loans.
No. VA loans have no official loan limit for borrowers with full entitlement. Higher loan amounts, including VA jumbo loans, are available based on lender guidelines and borrower qualification.
Yes. VA loans can be used multiple times as long as sufficient entitlement is available or restored.
Yes. VA refinance options include the VA IRRRL for lowering interest rates and the VA Cash-Out Refinance for accessing home equity.
No. VA loans do not require private mortgage insurance (PMI), which helps keep monthly payments lower.
Determine how much home you can afford.
Learn what it costs to fund a VA loan.
Calculate your Basic Housing Allowance.
Find out how much you can borrow for $0 down.
Obtain a construction loan for building or improving a home
Estimate your loan preapproval amount based on your income and expenses.
See if refinancing makes sense for you.
