In 1944, the government passed the G.I. Bill, a law which provided a wide range of benefits to U.S. soldiers returning from World War II. One of the G.I. Bill's programs -- the VA Loan Guaranty -- awarded veterans with at least 90 days of active duty during the war years access to low-cost mortgages nationwide.

Nearly 70 years later, the VA Loan Guaranty program has been used more than 20 million times. The Department of Veterans Affairs program continues to help eligible military borrowers purchase, refinance and renovate homes in all 50 states and the District of Columbia.

In 2012, more than $119 billion in VA loans were funded nationwide and World War II veterans continue to benefit from the program -- 684 VA loans were made to World War II vets, specifically, last year.

VA Loans : Mortgages For Eligible Military Borrowers

The Department of Veterans Affairs administers the VA Loan Guaranty program. The agency doesn't make VA loans directly -- the loans are made by banks. The VA simply guarantees a portion of the loan, which protects the bank from loss.

Because of this guarantee, VA lenders can provide military borrowers with more favorable loan terms than for a non-guaranteed loan (e.g.; conventional mortgage).

There are five VA loan guaranty programs :

Purchase Loans, for the purchase of a new home
Cash Out Refinance loans, for taking cash from your home
Interest Rate Reduction Refinance Loans (IRRRL), for lowering your existing VA mortgage rate
Native American Direct Loan (NADL) program, for purchase, construction or improvement of homes
Adapted Housing Grants, for veterans with permanent and total service-connected disability

Each program can be used for the purchase of a single-family or multi-family home, including housing units in condominium buildings and co-ops. VA refinance loans can also be used for home renovation and energy-efficiency programs.

There is no official loan size limit with the VA Loan Guaranty program, but limitations can apply based on your area.

For example, VA borrowers in "high-cost" areas such as San Diego, California can borrow via the VA loan program than borrowers buying or refinancing near Dayton, Ohio's Wright-Patterson AFB.

When you get your VA mortgage rates, ask about your local loan size limits.

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Gulf War Veterans Top 2012 VA Home Buyers

The VA loan program is available to eligible military borrowers and surviving spouses and during Fiscal Year 2012 the VA guaranteed 539,884 home loans, marking a 51% increase from the year prior and a three-fold increase as compared to Fiscal Year 2008.

Ultra-low mortgage rates played a role.

The number of rate-reducing IRRRL mortgages more than doubled between FY 2011 and FY 2012, climbing from one-hundred thirty-six thousand to two-hundred eighty-one thousand. "Other" refinances also climbed sharply, adding to last year's final tally.

VA borrowers refinanced close to $62 billion via the IRRRL program, which is sometimes referred to as the VA Streamline Refinance. Rate reductions accounted for more than half of the VA-backed loans made last year.

Other interesting patterns emerge when we split the loan data by period of service entitlement.

First, Restored Entitlement loans outnumber all other entitlement types. This is because "Restored Entitlement" describes when VA loan has been paid in full via home sale, or when the homeowner agrees to assume the outstanding VA loan balance.

We should expect Restored Entitlement figures to be high in a recovering housing market. Veterans are move-up buyers, too, after all.

Second, Gulf War veterans comprised 28.5% of all VA loans guaranteed in FY 2012. This was the largest uniform class of service entitlement. The group of Gulf War veterans includes military borrowers with service dates from August 2, 1990 to the present.

Lastly, it's noteworthy that today's active military personnel accounted for 19% of last year's VA loan guarantees. Among all service classes, active personnel boasts the largest average loan size, registering $230,802 per VA loan.

Korean Conflict veterans showed the smallest average loan size at $160,584 per VA loan.

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The G.I. Bill provides subsidized mortgage lending, which is why VA mortgage rates are often so low as compared to conventional and jumbo mortgage rates. This is one reason why VA closings tripled between 2008 and 2012. Another reason is the VA's 100% financing.

With mortgage rates still low, VA loan guarantees remain in high demand. See what a VA loan can do for your budget. Get started with a rate quote today. It's fast, it's free, and no social security number is required.

The article Gulf War Veterans And Active Military Personnel Push FY 2012 VA Loan Guarantees To Record-Levels originally appeared on themortgagereports.com.