No-BS Guide: VA Loans in Colorado Springs — What Buyers Need to Know

The VA loan is a powerful benefit: no down payment, no PMI, competitive rates. The catch? Fine print. Without a VA-savvy guide, buyers can face surprise costs, delays, or missed opportunities. Here’s the straight talk—and how The Johnson Team helps you use the benefit the right way in Colorado Springs.

Why the military footprint matters in Colorado Springs

Colorado Springs is home to five major installations—Fort Carson, Peterson and Schriever Space Force Bases, Cheyenne Mountain Space Force Station, and the U.S. Air Force Academy. PCS cycles bring ready-to-move buyers year-round, and defense/aerospace work keeps demand steady across neighborhoods. Translation for VA buyers: the loan is common here, competition can be real, and a clean file with a VA-savvy team gives you an edge. And we plan around real timelines—report dates, TDY windows, and BAH-driven budgets—so your search, offer, and closing stay in step with your move.

The VA funding fee: what it really means

Zero down isn’t zero cost. Most VA buyers pay a VA funding fee that can be financed into the loan or paid at closing.

• How it’s calculated:
  
  

• First-time use, 0% down: 2.15% of the purchase price
  
  

• Subsequent use, 0% down: 3.30%
  
  

• Put 5% down and the fee drops; put 10% down and it drops further
  
  

• Example: On a $300,000 purchase with 0% down and first-time VA use, the fee is $6,450 (2.15%). If you finance it, your starting loan becomes $306,450, so you begin slightly underwater until you build equity.
  
  

• Who’s exempt: Buyers with VA disability compensation, active-duty Purple Heart recipients closing while on orders, and certain eligible surviving spouses.
  
  

• Can the seller help? Yes. VA allows seller concessions up to 4% of price/value that can cover the funding fee and other allowable costs if negotiated.
  
  

• Why it matters: If you expect another move within a few years (PCS, promotion), the fee can lengthen your break-even timeline. We’ll map how the fee affects your monthly payment and equity path—and when it makes sense to seek an exemption, put a small amount down, or negotiate seller help.
  
  

Bottom line: The funding fee is predictable and manageable with the right plan. The Johnson Team will show the exact numbers for your price range in Colorado Springs and structure terms so there are no surprises.

“Zero down” ≠ zero cash at closing

You’ll still need earnest money, inspection fees, appraisal, and closing costs. A VA-savvy agent will structure offers to pursue seller credits when possible, help you compare lenders, and flag junk fees—so there are no unexpected dollars due.

VA appraisal and MPRs: keep your deal on track

The VA appraisal checks value and Minimum Property Requirements for safety and soundness. Missing railings, roof issues, peeling paint, or unsafe systems can delay your loan approval until the repairs are completed. A seasoned agent spots red flags early, writes protective terms, and negotiates repairs so the deal keeps moving.

Low appraisals: what happens and your choices

If the VA appraisal comes in below your contract price, the VA will only back the loan up to the appraised value (the Notice of Value). Your lender must base the loan on that lower number.

Your playbook:

• Tidewater heads-up (if triggered): Before the appraiser finalizes a low value, we can submit better comps within a short window to try to lift the value.
  
  

• Reconsideration of Value (ROV): If the value still lands low, your lender can ask the VA to reconsider using stronger comps and a written case. Sometimes this fixes the gap.

If the value stays low, you have options:

1. 1. Renegotiate the price down to the appraised value.
      
      

   2. Split the difference with the seller (they drop some, you bring some cash).
      
      

   3. Bring cash for the gap—you can’t finance above VA value, the difference must be cash.
      
      

   4. Cancel under your appraisal contingency and keep your earnest money.
      
      

Quick example:
Contract price $400,000 → Appraised value $385,000 → Gap $15,000

• Seller reduces to $385,000 → no gap.
  
  

• Seller drops $10,000, you bring $5,000 cash.
  
  

• You bring $15,000 cash to keep price at $400,000.
  
  

• Or you cancel and recover earnest money.
  
  

How we help: The Johnson Team sets expectations up front, prepares comps for Tidewater/ROV fast, and writes clean appraisal language so you’re protected—and only bring cash if the payment and long-term plan still make sense.

The VA isn’t the lender—shop smart

The VA guarantees the loan; private lenders make it. Rates, fees, and overlays vary. A VA-experienced agent connects you with lenders who consistently close VA files cleanly and advocates for terms that fit your goals. The VA guarantees part of the loan, but banks and mortgage companies set the pricing, fees, and speed, so quotes and requirements can differ. Compare two or three VA-experienced lenders on rate, APR, any credits, and turn times—and choose the one that consistently closes VA files cleanly in Colorado Springs.

What “VA guarantees the loan” really means
The VA doesn’t lend you the money—it backs a portion of the loan for the lender, like a built-in co-signer. With full entitlement, the VA typically guarantees about 25% of the loan amount. That reduced risk is why lenders allow $0 down, no PMI, and still offer competitive rates. If you’ve used some entitlement before, the guaranteed amount is smaller, which can affect how much you can borrow with zero down. Lenders still verify income, credit, and the property—this guarantee doesn’t skip underwriting; it just makes approval terms more favorable.

You can use your VA benefit more than once

Your VA entitlement can be restored and reused—even held on two properties in certain scenarios. Your agent should explain how entitlement works and help you plan for PCS moves or long-term strategy without guesswork.

How The Johnson Team helps VA buyers in Colorado Springs

• Clarify true cost: funding fee impact, cash-to-close, and a comfortable payment range
  
  

• Pre-spot appraisal and MPR issues before you spend on inspections
  
  

• Structure offers to pursue seller credits and clean timelines
  
  

• Connect you with proven VA lenders and keep docs flowing
  
  

• Confirm exemptions early and structure concessions smartly: we verify funding-fee exemption status up front and negotiate seller concessions within VA’s 4% cap to reduce your cash to close when possible
  
  

• Build a multi-move plan if you’ll reuse the benefit down the road
  
  

Talk with The Johnson Team

Questions about using a VA loan or timing a PCS? The Johnson Team builds a clear plan around your report date, lines up lenders who close VA files cleanly, and targets neighborhoods that match day-to-day life near your gate. We handle the details—so when the right home hits, you’re ready.