Why a 7 Percent Rate Makes an Assumable VA Loan Worth a Hard Look in Kitsap County

On September 24, Freddie Mac's weekly survey put the average 30-year mortgage rate at 7.03 percent. That was the first 7 percent reading in over a year, and it came a week after the Federal Reserve raised its benchmark rate for the first time since 2023. National averages for 30-year VA loans were running in the high 6s by the end of the month.

For a military family buying near Naval Base Kitsap, that's not great news on its own. But it quietly makes one tool a lot more valuable than it was in the spring: the assumable VA loan.

What an assumption actually is

Every VA-backed loan can be assumed. That means a qualified buyer can take over the seller's existing loan, including its interest rate and remaining term, instead of getting a brand-new mortgage. The buyer still has to qualify with the loan servicer, and VA charges a funding fee of 0.5 percent on an assumption, far less than the 2.15 percent most first-time VA buyers pay on a new purchase loan. If you want the full process laid out step by step, our VA Assumption Guide walks through it.

A lot of homes around Bremerton, Silverdale, and Port Orchard were bought or refinanced by military families between 2020 and 2022, when VA rates were in the 2s and 3s. Many of those families are now getting orders out. Their loans didn't go anywhere.

What the rate gap is worth

Here's a simple example. Say a seller owes $310,000 on a VA loan at 2.75 percent with about 23 years left. Their principal and interest payment is roughly $1,517 a month. A new 30-year loan for that same $310,000 at 6.9 percent would run about $2,042. That's a difference of around $525 a month, or more than $6,000 a year, on the same amount of debt.

Over a three- or four-year tour, that gap adds up to real money. It's also why a rate headline that sounds like bad news for buyers can be very good news for a seller who happens to have one of these loans. We walk through a full scenario in our worked example of a VA assumption in Kitsap County.

The catch nobody puts in the headline

The low rate only covers the balance that's left. If that house sells for $600,000, which is right around the Kitsap County median, and the seller owes $310,000, there's a $290,000 gap between the price and the loan. The buyer has to cover it, either in cash or with a second loan. VA put formal rules around second loans behind an assumed VA loan in 2024, and more lenders offer them now, but they come at today's rates, not the old one.

That's why assumptions tend to work best in a few situations. The seller has been in the home a shorter time, so the balance is closer to the price. The buyer has savings from a previous home sale. Or the numbers still work out better even after blending in a second loan at a higher rate.

Entitlement is the other piece. If the buyer is an eligible veteran or service member, they can substitute their own VA entitlement, which frees up the seller's to use again. If the buyer isn't, the seller's entitlement stays tied to that loan until it's paid off. For a family planning to buy again at their next duty station, that's a big deal, and it should be settled before anyone signs.

Assumptions also take longer than a standard purchase, because the loan servicer runs the approval, and servicers set their own pace. If your report date is tight, build that into the plan from the start.

How one family made it work

One Navy family we helped began their search while still stationed overseas, working around the time difference. They were using a VA loan, and they told us later that Jason "was extremely diligent to seek out properties available with a VA loan assumption, and other homes available for purchase with a VA loan making it significantly easier for us." They ended up in Silverdale. The search worked because we were looking for assumable loans from the first week, not as an afterthought once rates were already hurting.

If you're selling, say so in the listing

If you're PCSing out and you have a VA loan in the 2s or 3s, that rate is part of what you're selling. It belongs in the listing description and in the conversation with every buyer's agent who calls. Just go in knowing how you'll handle your entitlement, and talk to us about it early. We can walk you through how we plan a PCS sale and what the loan side looks like.

If you want us to look for assumable loans in the part of Kitsap you're considering, or to run the numbers on your own loan before you list, we're happy to sit down and work through it with you.