VA Loan Calculator

A VA loan is a mortgage backed by the US Department of Veterans Affairs and originated by VA-approved private lenders. Eligibility is service based: active-duty service members, veterans who meet length-of-service minimums (generally 90 days during wartime or 181 days during peacetime), members of the National Guard and Reserves with at least 6 years of service or 90 days of active duty, and surviving spouses of service members who died on active duty or from a service connected disability. Eligibility is confirmed by a Certificate of Eligibility (COE) from the VA before closing. Unlike FHA or conventional financing, the VA loan benefit does not expire and can be used more than once over a lifetime.

The funding fee is a one-time charge that replaces the monthly mortgage insurance you would pay on FHA or low-down conventional loans. For purchase loans closing on or after April 7, 2023, the current schedule is 2.15% for first use with less than 5% down, 1.5% with 5% to 9.99% down, and 1.25% with 10%+ down. On a subsequent VA loan the under-5% rate jumps to 3.3%, but the 5%+ and 10%+ tiers stay at 1.5% and 1.25%. The fee is calculated on the base loan amount (home price minus down payment) and is usually financed into the loan rather than paid in cash at closing.

Three groups pay no funding fee under 38 USC 3729: veterans receiving VA compensation for a service connected disability (any rating from 10% to 100%), veterans who would be entitled to such compensation but are receiving retirement or active-duty pay instead, and surviving spouses of veterans who died in service or from a service connected disability and are receiving Dependency and Indemnity Compensation (DIC). Purple Heart recipients on active duty also qualify under the 2019 Blue Water Navy Vietnam Veterans Act. Exemption is determined by the VA and shown on the Certificate of Eligibility. For an exempt borrower a zero-down VA loan beats almost any other financing on the market: no down payment, no funding fee, no monthly mortgage insurance.

The funding fee replaces it. On an FHA loan you pay 1.75% upfront MIP plus 0.55% to 0.75% annual MIP every year for either 11 years or the full term. On a conventional loan under 20% down you pay PMI of roughly 0.5% to 1.5% annually until the loan reaches 78% LTV. The VA's design folds the lender's risk insurance into a single up-front payment, which is dramatically cheaper over the life of a long-held loan: a zero-down VA borrower paying 2.15% once typically saves $40,000 to $70,000 over 30 years vs an equivalent FHA borrower paying 1.75% upfront plus 0.55% per year for the full term. That is the figure the savings-vs-FHA panel on this calculator estimates.

An eligible borrower with full entitlement may obtain a VA-backed purchase loan without a VA-imposed down-payment requirement or county loan limit, but the lender still applies credit, income, appraisal, and underwriting rules. Partial entitlement can make county limits relevant to the guaranty calculation. Funding-fee status and lender terms also matter, so confirm eligibility and cash requirements with the Certificate of Eligibility and Loan Estimate.