From the Blog
VA Loan Assumptions in San Antonio: The 0.5% Fee and the $731-a-Month Math
A VA loan can be assumed by any buyer who qualifies, veteran or civilian, and the VA's assumption funding fee is only 0.5% of the remaining loan balance, about $1,500 on a $300,000 loan. With new purchase rates near 7.2%, taking over a seller's 3% VA loan could save roughly $731 a month on the same balance, about $8,770 a year. Here is how VA assumptions actually work in San Antonio and why they are quietly one of the smartest ways to buy near JBSA without waiting for rates to fall.
A VA loan can be assumed by any buyer who qualifies, veteran or civilian, and the VA's assumption funding fee is only 0.5% of the remaining loan balance, about $1,500 on a $300,000 loan. With new purchase rates near 7.2%, taking over a seller's 3% VA loan could save roughly $731 a month on the same balance, about $8,770 a year. Here is how VA assumptions actually work in San Antonio and why they are quietly one of the smartest ways to buy near JBSA without waiting for rates to fall.
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The number that makes assumptions interesting
Federal law (38 U.S.C. 3714) requires a VA loan to be approved for assumption once three conditions are met: the loan is current, the buyer assumes full liability, and the buyer meets VA creditworthiness standards. The VA assumption funding fee is 0.5% of the remaining balance, payable in cash at closing and not financeable, about $1,500 on a $300,000 balance. Veterans exempt from the standard VA funding fee are also exempt from the assumption fee. No military service or VA entitlement is required to assume; the loan's servicer underwrites the buyer.
The savings math on a $300,000 balance
Run principal and interest only. A 30-year fixed at 3% on a $300,000 balance carries about $1,265 a month; at 4%, about $1,432. A new 30-year fixed near 7.2% on the same balance runs about $1,996. Assuming the 3% loan saves roughly $731 a month, about $8,770 a year, and assuming the 4% loan saves about $564 a month, roughly $6,768 a year. Property taxes and insurance still reset to the new buyer's numbers, but the interest rate is locked for the life of the loan.
Who approves it, and how long it takes
The loan's servicer underwrites the buyer's credit, income, debts, and occupancy intent under VA standards. For loans closed on or after March 1, 1988, the VA must also approve the assumption, and servicers with automatic authority must issue a decision within 45 days per VA Circular 26-23-27. The seller's VA entitlement stays tied to the loan until it is paid off or the assuming buyer's entitlement substitutes, which is why a knowledgeable agent asks the right questions before anyone signs.
Where assumable loans live in San Antonio
Homes bought in 2020 through 2022, when the 30-year fixed averaged roughly 3% to 4.5%, are exactly where assumable VA loans sit. Military-heavy corridors around JBSA-Lackland, JBSA-Randolph, and Fort Sam Houston, plus Schertz, Cibolo, and Converse, are prime hunting grounds. The catch is that assumptions are negotiated: the seller does not have to accept one, and the buyer still pays the difference between the loan balance and the purchase price in cash or with a second lien.
Frequently asked questions
Do I have to be a veteran to assume a VA loan?
No. Any buyer who meets VA creditworthiness standards can assume, and the servicer must approve the assumption. Non-veterans pay the same 0.5% assumption fee unless exempt.
What does the seller give up?
The seller's VA entitlement remains obligated on the loan until it is paid off or the assuming buyer substitutes their own entitlement. That is the main reason some sellers hesitate, and why the negotiation matters.
What if the balance is less than the price?
The buyer covers the difference between the loan balance and the purchase price in cash or with a second loan. The assumed first lien keeps its original rate.
Written by Phyllis Domingo
REALTOR® · TX License 745926 · 100+ homes sold · Helping families move well in San Antonio and the Hill Country since long before the hard part became normal.
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