VA Loan Calculator

The short answer

• With full entitlement you can buy with no down payment and there is no VA loan limit.
• There is no PMI. Instead most borrowers pay a funding fee: 2.15% of the loan the first time with less than 5% down, 3.3% after that.
• Veterans receiving compensation for a service-connected disability, and some others, pay no fee at all.
• On a $400,000 home at 7.25% with nothing down, the payment is about $3,234 a month with the fee financed.

What a VA loan is

A VA loan is a mortgage from a private lender that the Department of Veterans Affairs partly guarantees. If you default, the VA repays part of the lender’s loss. That guarantee replaces the down payment and mortgage insurance a lender would otherwise want. The funding fee helps pay for the program, so it costs taxpayers less.

Who is eligible

Eligibility depends on your service. It generally covers veterans and service members who meet minimum active-duty service requirements, National Guard and Reserve members with qualifying service, and some surviving spouses. You prove it with a Certificate of Eligibility (COE), which your lender can usually request online. The COE also shows your entitlement and whether you are exempt from the funding fee.

A worked example

A $400,000 home, first use of the benefit, no down payment, 7.25% for 30 years, 0.89% property tax and $1,800 of insurance a year:

There is no PMI line. Over 30 years the loan costs $594,854 in interest; a bigger down payment or a lower rate would cut that.

The 2026 funding fee

The VA’s current funding fee rates took effect on April 7, 2023, and are unchanged for 2026. For purchase and construction loans:

Other VA loans have their own fees: 0.5% for an interest rate reduction refinance (IRRRL), 2.15% or 3.3% for a cash-out refinance, 0.5% to assume a VA loan and 1% for a manufactured home not on a permanent foundation.

The fee in dollars

The fee is a percentage of the loan, not the price, so with 5% or 10% down it applies to the smaller loan.

Who is exempt

According to the VA, you do not pay the funding fee if any of these apply:

• You receive VA compensation for a service-connected disability.
• You are eligible for that compensation but receive retirement or active-duty pay instead.
• You are a surviving spouse receiving Dependency and Indemnity Compensation (DIC).
• You are a service member with a proposed or memorandum rating, before closing, saying you are eligible for compensation from a pre-discharge claim.
• You are on active duty and show you received a Purple Heart on or before closing.

On the example home, an exemption saves $8,600 upfront, or $58.66 a month if the fee would have been financed. If you are later awarded compensation effective before your closing date, you may be able to get the fee refunded.

Financing the fee

You can pay the funding fee at closing or add it to the loan. On purchase loans it is the only cost that can be financed; other closing costs must be paid in cash or by the seller.

Financing makes sense if the cash is better kept as an emergency fund, or if you expect to sell or refinance within a few years. Remember it also leaves you owing more than the price on day one.

Does a down payment help?

Putting 5% down cuts the fee by $2,900 and the payment by $156 a month. For someone using the benefit a second time, the saving is bigger: the fee drops from 3.3% ($13,200) to 1.5%. Whether it is worth it depends on what else that cash could do for you.

No PMI

A conventional loan with less than 20% down carries PMI until you reach 22% equity, and an FHA loan with less than 10% down carries MIP for its whole life. A VA loan has neither, at any down payment. That is the main reason it usually beats both, even with the funding fee.

Loan limits and entitlement

Since January 1, 2020, borrowers with full entitlement have no VA loan limit: the VA guarantees a quarter of any loan amount, so lenders can lend with no down payment. You have full entitlement if you have never used it, or if you repaid an earlier VA loan in full and sold the home.

With remaining (reduced) entitlement, for example while an earlier VA loan is still open, the county conforming loan limit sets how much you can borrow without a down payment. For 2026 that limit is $832,750 in most counties and up to $1,249,125 in high-cost areas.

Residual income

Besides the debt-to-income ratio (the VA’s benchmark is 41%), VA lenders check residual income: what is left each month after the mortgage payment, taxes, other debts and an allowance for maintenance and utilities. The VA’s guide for loans of $80,000 or more:

Add $80 for each family member over five. Lenders look more closely when residual income is low or the ratio is above 41%, but these are guides rather than hard cut-offs. The calculator shows the guide figure for your household under More options; our debt-to-income calculator works out your ratio.

VA vs FHA vs conventional

The same $400,000 home at 7.25% for 30 years:

The VA loan needs no cash for the down payment and is cheaper each month than FHA. A conventional loan with 5% down is a little cheaper each month at the same rate, but needs $20,000 more upfront and charges PMI for years. VA rates are often competitive, so ask for quotes on each. Our FHA loan calculator covers the FHA side in detail.

Closing costs on a VA loan

You still pay closing costs, but the VA limits what lenders can charge veterans, and sellers can pay some or all of them. Get a Loan Estimate from several VA lenders and compare the fees, not just the rate. Our closing cost calculator shows the usual lines.

Property and occupancy rules

A VA loan is for a home you will live in, including homes with up to four units if you live in one. The VA appraisal checks the value and that the home meets minimum property requirements: safe, structurally sound and sanitary. Repairs it flags usually have to be done before closing.

Refinancing a VA loan

If rates fall, an interest rate reduction refinance loan (IRRRL, or “streamline”) swaps your VA loan for one at a lower rate with a 0.5% funding fee and little paperwork. A VA cash-out refinance lets you borrow against your equity, with the same 2.15% or 3.3% fees as a purchase. Our refinance calculator finds the break-even point.

Common mistakes

• Not checking the COE for a funding fee exemption before closing.
• Assuming no down payment means no cash: you still need closing costs, moving money and reserves.
• Forgetting that the second use costs 3.3% with less than 5% down.
• Comparing VA and conventional on the rate alone, without the fee and PMI.
• Starting with almost no equity and having to sell early in a falling market.

Using the calculator well

1. Enter the price and any down payment, a real VA rate quote and the term.
2. Choose first use or used before, and switch on the exemption if your COE shows one.
3. Pick your state for typical property tax, and add insurance and HOA dues under More options.
4. Set your household size and region to see the VA residual income guide.
5. Read the comparison to see what VA saves against FHA and conventional loans.

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