The U.S. Department of Veterans Affairs’ home loans program saw a 50 percent increase in mortgage applications during fiscal year 2012, and has guaranteed its highest number of loans since 1994, National Mortgage News reported Oct. 16.

The department guaranteed nearly 540,000 loans during FY 2012 that ended Sept. 30, up 300 percent from five years ago. Mortgage refinancing accounted for roughly 338,000 of the total applications received by the VA.

Originations for VA loans saw significant increases as interest rates dropped, and subprime lending and credit standards for conventional financing stiffened, National Mortgage News reported. Extremely low rates on average interest for VA home loans have reached all-time lows over the past few months.

Aside from extremely low interest rates, the big appeal to VA mortgages is that qualified borrowers may be eligible for a no down payment option, something unavailable with Fannie Mae and Freddie Mac mortgages, National Mortgage News reported.